SAINT-HYACINTHE, QUE. — Olymel LP, a Canadian poultry and pork processor and distributor, plans to close its hog slaughtering, cutting and deboning plant in Vallée-Jonction, Que.
The company said the closing would result in 994 employees being laid off, which includes 911 union members and 83 managers. According to Olymel, employees were recently informed of the decision during meetings held at the plant.
Olymel said the move was necessary after it absorbed more than $400 million in losses over the last two years.
“After carefully examining the difficult situation in the fresh pork sector and searching for the best way out of this crisis, it has become clear that closing one of Olymel’s four slaughtering, cutting and deboning plants in Quebec was inevitable,” said Yanick Gervais, president and chief executive officer of Olymel.
Mr. Gervais added that the company’s decision to close the Vallée-Jonction plant was not region-based and was a result of careful analysis that focused on operational capabilities for the four plants owned by Olymel in Quebec.
“Closing a plant was necessary to reduce our slaughter capacity and review our business model in order to optimize it, and our analysis ultimately revealed the limitations of the Vallée-Jonction plant, given the steady decline in the available workforce and the condition of the facilities, which would require investing tens of millions of dollars in renovations,” Mr. Gervais said.
Olymel said that due to the large capacity at Vallée-Jonction, the facility closing will happen over eight months. During mid-September, the evening shift of 443 production workers will stop. The day shift, which involved 468 workers, plans to continue until the plant ceases operations on Dec. 22, 2023.
Other factors for the plant closing stated by Olymel included the COVID-19 pandemic, labor shortage and instability of export markets, and increased raw material costs.In February, Olymel said it would close two other pork processing plants by April 28.