COVID-19 outbreak keeps pressuring the supply chain

The US meat processing sector continues to be hammered by the coronavirus outbreak.  The Smithfield Foods hog processing plant in Sioux Falls, South Dakota announced on Sunday it will close indefinitely as it continues to battle COVID-19.  More than 230 employees have  now tested positive.  The company had announced a temporary closure last week.  More than 230 employees have now tested positive.  

University of Missouri livestock economist Scott Brown says prolonged shutdowns are his biggest concern right now.  “If we can kind of hold that together and not see a lot more shut downs, maybe we get through,” he says.  “But, I say we have to weather it pretty hard here the next couple, three weeks.”

He tells Brownfield despite strong grocery demand for red meat, overall demand is suffering.  “We look at those pork cutout values and choice box beef price and it just reminds you it’s getting to be tougher,” he says.  “And you put on top of that plants that might not be operation and I worry about where that goes.”

Smithfield president CEO Kenneth Sullivan says the closure of this facility along with the growing list of processing facilities that have shuttered, are putting pressure on the country’s meat supplies.  He says if plants continue to close it will become increasingly more difficult to keep grocery stores stocked, but will also have repercussions for those in the supply chain, especially the nation’s livestock farmers.  He says in preparation for a full shutdown, some activity will occur at the plant on Tuesday to process product in inventory.  The company will resume operations once it receives direction from local, state, and federal officials.  Employees will continue to receive compensation for the next two weeks.  

The plant is one of the largest pork processing facilities in the US and represents about 4 to 5 percent of US pork production.

This follow’s the announcement from JBS Swift that its beef processing plant in Greeley, Colorado has shut down following the death of a second employee from COVID-19.

In a release on Friday, the company announced it is working to secure COVID-19 tests for all of its employees.  JBS says they’re using the holiday weekend to coordinate employee testing and will also use the time to further enhance its previously deep cleaning efforts.  JBS had previously stopped operations at its plant in Souderton, Pennsylvania, it has plans to reopen on Thursday. 

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