COVID-19 in Rural Counties

[dado potato]

Hog slaughtering plants are being shut down due to COVID-19. The usual assumption is that after a deep cleaning and installing some safe-distancing measures, the plants will re-open and the workers will come back. As I understand it, workers who are unemployed due to COVID-19 would qualify for an average of $380/week in state unemployment benefits, topped up with $600/week bonus benefit from CARES Act. So the incentive to stay home (albeit "looking for work") would be $980/week.

The counties where hog, beef and chicken processing plants are located have a rate of COVID-19 infection 75% greater than than the US average, according to reporting in USA Today. It seems likely that more closures will occur in future. For hog farmers, already 15% of the nation's hog slaughtering plants are shut down. Hog farmers who have market-ready pigs and no place to sell to, must contemplate culling. USA Today estimated that hundreds of thousands of pigs are about to be culled. By the first week of May, we can expect significantly higher retail prices and reduced quantities of pork products available for sale. Predictably, big box retailers will be better able to stock their shelves than smaller retail stores.

Conditions of excess capacity also have affected dairy farms (dumping milk) and broiler operations (breaking eggs).

[jp1]

Are the workers being furloughed or outright let go. If it's the former they will have little choice but to come back to work once the plat reopens since their unemployment checks will stop at that point.

[dado potato]

Are the workers being furloughed or outright let go. If it's the former they will have little choice but to come back to work once the plat reopens since their unemployment checks will stop at that point.

From various articles reporting on specific plants, I gather that usually the workers are furloughed or "compensated while the plant is closed".

One of the aspects of reopening a plant is to test the workers before they return to work. It may be that workers who test positive would need to be quarantined if symptom-free. The plants may have the option of re-opening and operating on a reduced number of shifts, if there is a lack of workers who test negative.

[dado potato]

Tyson Foods bought a full-page ad in the New York Times and the Washington Post: the corporate view of culling.

Millions of animals -- chickens, pigs, and cattle -- will be depopulated because of closure of our processing facilities.

... There will be a limited supply of our products available in grocery stores until we are able to reopen our facilities that are currently closed.


Tyson Foods recently closed pork processing plants in Waterloo IA and Logansport IN. Other companies that have idled pork processing plants include:
Smithfield Foods, Sioux Falls, SD
JBS, Worthington MN

About 85% of pork processing capacity remains operational. But there is a risk that public health officials tracing contacts of people who test positive will observe other abattoirs that have been sites for the spread of the virus.

As processing plants are idle, theoretically prices will go up for the processed meat product, at the same time prices will go down for the livestock producer. I can see the public relations advantages of the advertising... get in front of the predictable news reports of bare shelves at the meat counter ... and the alarm reaction of consumers to higher prices.

[SteveinMN]

My take on the Tyson CEO's comments on this topic is that he's a little excitable. I suppose it's his bonuses at stake.... Tyson is not the only meat processor in the country. While the CEO identifies a very real threat in the spread of the coronavirus in meat-processing facilities, and while I do expect spot shortages, particularly at smaller grocery stores, I do not expect to see linear foot upon linear foot of empty coolers.

As I wrote in a post on another thread here, I suspect the greatest damage to Tyson (and companies like it) will be to their bottom line, as they have to increase the space between workers (an issue well before the coronavirus showed up) and provide more documentation of where the animal came from, who did what with it at the plant, and where it ended up for sale (this, too, an issue well before this year; cf. annual recalls of ground beef). They may no longer have the luxury of treating their workers as disposable drones.

The Tyson CEO also seems to forget that, if people don't find pork chops in a cooler near them, they'll buy hamburger or steaks or chicken breasts or even fish. They won't go hungry. Pork seems to hit the unlucky spot in the food chain; you can leave a cow in the field longer if you need to; you can "depopulate" (nice euphemism there but I eat meat so I won't poke too hard) the chicken herd quickly and easily; hog production is not that flexible.