Smithfield Closes Sioux Falls Plant
Packing Plant Closures Increase as Industry Struggles With Positive Cases
GLENWOOD, Iowa (DTN) -- Smithfield Foods announced Sunday the company was closing its Sioux Falls, South Dakota, facility indefinitely after state officials reported the plant accounted for nearly 40% of all COVID-19 cases in the state and South Dakota's governor on Saturday demanded the plant close for at least two weeks.
Smithfield previously announced it would suspend operations at the pork plant for three days. South Dakota's state Department of Health on Saturday reported that 238 of the state's 626 coronavirus cases involved workers at the Smithfield plant, the Sioux Falls Argus-Leader reported.
Packing plants around the country now are among the most significant hotspots for COVID-19 cases in the country. Tyson, Cargill, JBS SA, National Beef and other major packers have also each faced similar shutdown scenarios. On Friday, JBS announced it would close its Greeley, Colorado, beef plant for at least three days after 36 workers there had tested positive and Colorado media reported two workers from the plant had died.
Smithfield employs 3,700 workers in Sioux Falls, and the plant, formerly known as the John Morrell plant, accounts for roughly 5% of all pork production in the U.S. Smithfield states the plant produces 130 million servings of food a week and more than 550 farmers deliver hogs to the plant.
Kenneth Sullivan, president and CEO of Smithfield, warned in a statement that closing Sioux Falls, coupled with other packing plant closures, will devastate meat supplies in the U.S.
"The closure of this facility, combined with a growing list of other protein plants that have shuttered across our industry, is pushing our country perilously close to the edge in terms of our meat supply," Sullivan said. "It is impossible to keep our grocery stores stocked if our plants are not running. These facility closures will also have severe, perhaps disastrous, repercussions for many in the supply chain, first and foremost our nation's livestock farmers. These farmers have nowhere to send their animals."
Sullivan added, "Unfortunately, COVID-19 cases are now ubiquitous across our country. The virus is afflicting communities everywhere. The agriculture and food sectors have not been immune. Numerous plants across the country have COVID-19-positive employees. We have continued to run our facilities for one reason: to sustain our nation's food supply during this pandemic. We believe it is our obligation to help feed the country, now more than ever. We have a stark choice as a nation: We are either going to produce food or not, even in the face of COVID-19."
While packing plant workers have become victims to the virus or fearful they may contract it, it's important to note the Food and Drug Administration stated there is no evidence food or food packaging is associated with transmission of the coronavirus. (https://www.fda.gov/…)
In his daily press conference on Friday, President Donald Trump warned that supply chains must stay open, and he referenced the need to provide aid to farmers. Vice President Mike Pence said he had talked with Colorado's governor and a senator about the outbreak at the Greeley plant, where it was reported there were 14 people hospitalized, with as many as 300 of Greeley's workers affected.
"I want to encourage people in Colorado that we will -- we will work to support that effort, but I also want to emphasize that all the people that are working in food supply -- from farmers, to meatpackers, to distributors, to truckers, to grocers -- continue to have our gratitude, as President Trump said just a few moments ago," Pence said.
Another JBS plant in Grand Island, Nebraska, also has seen at least 28 workers test positive for coronavirus. Tyson Foods announced last week it was temporarily closing an Iowa pork plant because of a high volume of positive cases while National Beef made the same decision for a beef plant in Iowa.
The Wall Street Journal reported Friday the administration was looking at ways to test workers and find other ways to ensure workers continue to process food during the pandemic.
Futures markets for hogs and cattle have declined sharply in just the past few weeks. The April and May contracts for live hogs have fallen over 36% since March 25, while the April and June live cattle contract has fallen about 15% during that time.
On March 10, the National Pork Producers wrote a letter to federal officials to develop a response to COVID-19 that protects public health, but also minimizes disruption to the food supply. The group called on a plan to ensure there was no shortfall of workers or a bottleneck, citing the potential "dire financial consequences for hog farmers and their communities if the labor shortage is not quickly addressed. On March 19, the U.S. government declared food processing an essential industry to continue working during stay-at-home orders.
Chris Clayton can be reached at Chris.Clayton@dtn.com
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