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Tyson warns that more meat factories will be closed

The company also said it will continue to produce less meat than usual since workers do not come to work during the coronavirus pandemic.

“We have and expect to continue to experience slowdowns and temporary stoppages of production facilities due to team member bottlenecks or decisions we make to ensure operational safety,” the company said in a statement in which the financial results in the first three months of this year.

“We will not hesitate to idle a thorough cleaning facility when needed,” CEO Noel White added during an analyst call on Monday.

“There will be a limited supply of our products in grocery stores until we can reopen our currently closed facilities,”

; warned CEO John Tyson in a full-page ad that recently appeared in newspapers across the country.

The Trump administration wants the factories to reopen

Tyson warned that further disruptions were imminent.
In an implementing regulation signed last week, President Agriculture Minister Sonny Perdue gave the power to rely on the Defense Production Act to force companies to keep their plants open. However, the order did not lead to the widespread reopening of the meat production facilities.

In a statement that responded to the policy, Smithfield praised the decision, but noted that “the next steps to open the currently closed facilities will be evaluated and announcements made when operations can resume at any location.”

Despite Trump's order, meat processors have difficulty staying open

The day after the president signed the order, JBS USA announced that it would partially reopen the pork production facility in Worthington, Minnesota, but only to put pigs to sleep that would not be processed due to supply chain bottlenecks.

“As we focus on restarting the Worthington plant on behalf of our team members who produce food for the country, we believe that it is our responsibility to strengthen when our production partners are in need,” said Bob Krebs, president of JBS USA Pork, said in a statement. “None of us want to put pigs to sleep, but our producers face a terrible, unprecedented situation.”

The National Pork Producers Council also praised the contract, but admitted that pigs continue to be wasted.

“Although bringing pork packaging companies back online is fundamental, the tragic reality is that millions of pigs cannot get into the food supply,” the Council said in a statement, adding, “we need a coordinated partnership between industry and Federal, state and local authorities to put pigs to sleep. “

The pandemic has halved pork processing capacity in the country, the company said.

The challenge for Tyson: While meat processing plants have come to a standstill, consumer demand for meat has increased.

Tyson (TSN) In the first three months of the year, 2.7% more beef was sold than in the same period in 2019. Pork sales decreased by 2% by volume, while chicken sales decreased by 1.5%, partly due to the closure of Restaurants due to the pandemic.

Overall, White estimates that retail sales have increased 30% to 40%. In the food service, sales fell by 25% to 30%.

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