The company’s Denison, Iowa plant will permanently cease its beef operations, leaving hundreds unemployed as a result.
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Tyson said their rendering system at the Denison plant will remain open.
In a statement, Tyson Foods declares that the decision was not at all easy for them to make, “because it affects the lives of our people, their families, and a community that has supported the plant for more than 50 years”.
Tyson Foods said its Denison plant employees will be able to apply for jobs at other Tyson locations, and it plans to offer financial incentives to hourly workers who qualify for openings at a facility in Lexington, Nebraska.
Even though they will no longer be on the job, eligible displaced workers will receive 60 days of pay, as required by the Worker Adjustment and Retraining Notification (WARN) Act.
The beef division at Tyson reported an operating loss in the latest quarter after a West Coast port slowdown due to work stoppages forcing the company to sell its beef at low prices due to customers cancelling their orders, while some sellers of cattle sold them at higher prices. IBP was acquired by Tyson Foods in 2001 and renamed Tyson Fresh Meats, the company said. The company now has approximately 113,000 Team Members employed at more than 400 facilities and offices in the United States and around the world.
A reduction in production capacity of its beef operations in response to today’s market conditions was the reason behind the decision to close the plant, which opened in 1961 as part of Iowa Beef Packers. Tyson’s other beef plants are located in Amarillo, Texas; Dakota City, Neb.; Finney County, Kan.; Joslin, Ill.; Lexington, Neb. and Pasco, Wash.
In 2014, the U.S. cattle herd sank to its lowest level since 1951 at roughly 89 million head based on the government’s January 1 inventory report. On August 3, Tyson reduced its earnings guidance for 2015 because of its Beef segment struggles. She said the plant’s closure has put her business, which specializes in dresses, in jeopardy. “There are a lot of unforeseen things”.
The closure also may reduce enrollment at Denison-Schleswig School District.
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Denison Mayor Brad Bonner said news of the plant closing came with nearly no warning.
