Dive Brief:
- Cargill Inc. and Foster Farms are closing two turkey production plants this year, resulting in layoffs of more than 1,600 people.
- Cargill will close its Springdale, Arkansas, turkey plant on Aug. 1, affecting 1,100 employees, a company spokesperson confirmed to Mekong Farmer on Wednesday, adding it was “the right move for the future of our turkey business.”
- Additionally, Foster Farms last week notified workers of plans to shutter its Turlock, California, turkey facility on May 9, citing changes in market demand. A spokesperson confirmed 519 people will be affected by layoffs.
Dive Insight:
The closures come as customer demand for turkey products wanes, which has caused prices to fall in recent years, hurting producers’ profits. Meanwhile, farmers are still fighting to keep avian influenza out of their turkey operations, which has raised costs for producers.
The average wholesale price for frozen whole hen turkeys was 94 cents per pound in 2024, down nearly 33% from the previous year, according to data from the U.S. Department of Agriculture. At the same time, bird flu has killed more than 14.2 million turkeys since 2022, bringing the national flock to its lowest point since 1985, an analysis from the American Farm Bureau Federation found.
Cargill plans to shift Springdale’s production to facilities in Missouri and Virginia, according to a spokesperson. Despite unfavorable market conditions, the company said “turkey remains an essential part of Cargill’s protein portfolio.”
While Foster Farms’ fresh turkey plant is set to close, the California-based poultry producer will continue to operate its “fully cooked” plant, also in Turlock.
“Foster Farms will continue to have a significant presence in the Central Valley,” the company said in a news release. “No other Foster Farms facilities will be impacted.”
Foster Farms said it will offer available transfer opportunities to affected workers, as well as job placement and support services. Cargill did not specify job services, severance or other benefits that will be offered to its Springdale employees.
“We recognize that this decision impacts the lives of many of our committed team members and does not reflect their efforts,” Foster Farms CEO Jayson Penn said in a statement. “We thank the team for their contributions, hard work, and ongoing dedication as we support them throughout this transition.”
In addition to the plant workers, the closures will impact nearby contract growers who raise turkeys for the locations. Arkansas is one of the top turkey producing states, only behind Minnesota and North Carolina, according to the USDA.
Cargill said it will still “honor contractual obligations to growers and continue to process turkey and other proteins at more than 40 primary, case-ready and value-added protein facilities in the United States and Canada.”
Springdale Chamber of Commerce President Bill Rogers told local ABC affiliate 40/29 News that “it’s the growers that are the backbone of any poultry industry,” and that commitments with farmers are likely why the Cargill plant is closing several months from now.
“They’re still in the process of [raising turkeys], which is one of the reasons why I think the company doesn’t plan to shutter until August 1st,” Rogers said.