OMAHA — ConAgra Foods, Inc. on Thursday said it will close two plants, expand another facility, and shift production between two plants, all within its Popcorn and Seeds platform. The moves, which are expected to be completed within the next eight to nine months, are part of ConAgra’s companywide effort to streamline manufacturing operations.
By fiscal 2009, ConAgra said it expects total plant rationalization efforts to result in a $100 million reduction in annual fixed costs.
As part of the announcement made Thursday, ConAgra said it would close its microwave popcorn plant in Edina, Minn. Beginning in late April, equipment and production capability will be transferred to plants in Rensselaer, Ind., and Irapuato, Mexico, where ConAgra said it will be able "to better meet customer demand while also maximizing efficiencies in warehousing, storage, and transportation."
ConAgra also said it will close its South St. Paul, Minn., plant, which produces popcorn balls, and transfer production capability to its plant in Lakeville, Minn. The company also will partially close its plant in Lake View, Iowa, which supplies bulk popcorn in tins and tote bags among other popcorn products. Production of bulk popcorn in tins and totes will halt in late May, ConAgra said. Going forward, ConAgra will produce popping corn and popcorn seed at its Lake View facility.
In addition to the plant closings, ConAgra detailed plans to expand its Rensselaer facility, where the company will increase production capacity and reorganize warehousing operations for improved efficiency in storing and distributing products. The company also noted its intent to sell its property in Edina and South St. Paul, Minn. Equipment will be moved from those locations to other ConAgra facilities.
"To ensure the long-term growth of ConAgra Foods, we are committed to identifying and implementing business processes that will maximize our investments in the production, storage and transportation of our products and ingredients," said Jim Hardy, executive vice-president of product supply. "By realigning production in our Popcorn and Seeds platform, we have taken yet another important step toward achieving a more efficient business model and building a stronger manufacturing base for growth, innovation and continued success."
In March 2006, ConAgra announced it would close 10 to 12 plants as part of the first phase of its strategy to achieve sustainable, profitable growth. The company provided details of its first round of changes in September 2006, including the closing of five plants.