USA, Smithfield. The largest pork producer in the U.S., Smithfield Foods, part of China's WH Group, will abandon its pork production in Vernon, California, and also reduce hog inventories in the western part of the country. The company said that production in Vernon will cease in early 2023.
It also said it would reduce sow numbers in Utah and look at abandoning operations in Arizona and California. The company cited "the escalating cost of doing business" in California as the reason for closing the plant just outside Los Angeles. It said there are higher taxes, labor costs and a lot of red tape there compared to other locations. Market analyses reported that pork production costs there averaged 3.5 times higher than at the other US plants Smithfield operates.
California also made news with a law called Proposition 12, which would require stricter husbandry standards for pigs, poultry and calves that must also be met by products imported into the state. The controversial law is currently before the U.S. Supreme Court to determine whether husbandry requirements can be imposed on non-California pork producers whose products are sold there. For the approximately 1,800 workers at the Vernon plant, according to media, Smithfield said it has offered transitional assistance, including relocation options to other company facilities.
An agreement has been reached with the unions on this, it said. Smithfield has a total of more than 40,000 employees in the U.S. and operates 46 meat plants and 500 farms.