Cargill to shutter turkey operation in Springdale (Updated)
by January 28, 2025 10:45 am 9,746 views
Cargill has confirmed it plans to close its turkey processing facility in Springdale. More than 1,000 employees and more than 100 farmers who raise turkeys for the company are being told Tuesday (Jan. 28) about the closure slated for Aug. 1.
“This Cargill closure in Springdale was not an easy decision to make given the impact to the people who work there and local producers,” Chuck Miller, corporate spokesman told Talk Business & Politics. “However, it is the right move to make for the future of our turkey business. Turkey remains an essential part of Cargill’s protein portfolio. We will shift much of Springdale’s production to our turkey processing plants in Missouri and Virginia and work to minimize supply disruptions to customers. We will 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.”
The company did not provide details about how it plans to honor contracts with farmers. Many farmers have significant bank loans that require multiple year contracts to pay off.
The plant opened in 1965 and grew to one of the largest employers in Springdale but in more recent years demand has been tepid for turkey and the industry beginning in 2022 was hit hard by bird flu.
The Wayzata, Minn.-based food producer warned in December of plans to lay off 5% of its workforce, or around 8,000 jobs. The company reported annual revenue declines of nearly 10% in 2024 with one-third of its business units failing to meet earnings goals.
Turkey prices were low in 2024 and oversupplies built up in cold storage, rising 44% for whole birds, nearly 4% for turkey breast and 8.7% overall, according to the latest report from the U.S. Department of Agriculture (USDA).
News of the Cargill closure follows competitor Foster Farms which recently announced plans to shut down its turkey processing facility in Turlock, Calif., effective May 9, resulting in 519 job losses.
CLOSURE RESPONSE
Springdale Mayor Doug Sprouse said he was sad to see such a long-time, integral employer close in the city and region.
“That’s a lot of jobs to absorb but if there is a silver lining it’s that the closure is still several months out and we do have a vibrant job market in Northwest Arkansas,” he said.
Bill Rogers, CEO of the Springdale Chamber of Commerce, said the chamber will do all it can to help employees who lose a job.
“We understand this is a challenging time, and our primary focus is on ensuring support for those impacted. … The contributions of the Cargill team to our local chamber, economy and community life cannot be overstated. While Springdale maintains a robust labor force of over 43,000, this loss is substantial challenge,” he said.
The Chamber said it is collaborating with local employers to identify job opening and facilitate connections for displaced workers. There is also a workforce development initiative in partnership with Arkansas Workforce Connections Rapid Response Program for displaced workers. Rogers said the chamber will schedule interviews for Cargill employees to register for the assistance program. Also, the chamber will host resourcing events and provide community support services for the employees.
“Springdale has a long history of resilience and we are confident that, together, we turn this difficult moment into an opportunity to diversity and grow our local economy while we support those who have been impacted,” Rogers said.
TURKEY WOES
Brian Earnest, animal protein economist with CoBank, said consumers are eating more beef and pork, resulting in less demand for turkey. He noted in November that whole bird consumption continues to decline and turkey processors would need to shift production to other products like ground turkey and deli meats.
The Springdale plant makes ground turkey under the Honey Suckle White brand, whole birds around Thanksgiving. The plant also makes sausages and case-ready products for retail. The plant is among the older in Cargill’s meat processing fleet. It was acquired by Cargill in 1976 from Ralston Purina who built the complex in 1965.
Plant Manager Shane Acosta said in 2018 Cargill had plans to automate some of the manual positions as soon as market conditions improved and demand dictated. But the COVID and workforce challenges made conditions difficult for meat packing operations. By the time the workforce recovered in 2022, Avian Influenza hurt the turkey industry. Between 2022 and 2024 roughly 340 U.S. commercial turkey flocks were lost to bird flu, according to the U.S. Department of Agriculture’s Animal and Plant Health Inspection Services (APHIS).
U.S. turkey consumption per person was around 13.9 pounds per year in 2024, down from about 15.4 pounds over the past five years, according to the USDA. In 2024, U.S. turkey production was down 6.3% from the prior year, according to USDA estimates.
Last week, Cargill agreed to pay $32.5 million to settle a 2019 class action lawsuit alleging that the meatpacker conspired with other companies to artificially raise turkey prices. Cargill was the second company to settle the case, following Tyson Foods’s $4.62 million settlement in 2021.