PLAINVIEW, TEXAS — Cargill is closing its Plainview, Texas, beef slaughtering and processing facility, citing the effects of the drought that has led to a shortage of available cattle. The plant employs approximately 2,000.

“The decision to idle our Plainview beef processing plant was a difficult and painful one to make and was made only after we conducted an exhaustive analysis of the regional cattle supply and processing capacity situation in North America,” said John Keating, president of Cargill Beef, based in Wichita, Kan.  “While idling a major beef plant is unfortunate because of the resulting layoff of good people, which impacts their families and the community of Plainview, we were compelled to make a decision that would reduce the strain created on our beef business by the reduced cattle supply.

“The U.S. cattle herd is at its lowest level since 1952. Increased feed costs resulting from the prolonged drought, combined with herd liquidations by cattle ranchers, are severely and adversely contributing to the challenging business conditions we face as an industry. Our preference would have been not to idle a plant.”

The company’s remaining beef plants in the region are located in Friona, Texas; Dodge City, Kas.; and Fort Morgan, Colo., and they will receive the cattle previously intended for the Plainview plant.

“Given the over-capacity that exists with four major beef plants in the Texas Panhandle and a dwindling supply of cattle in the region, idling Plainview will allow Cargill to operate its other beef plants in Texas, Colorado and Kansas more consistently on a five-day-per-week basis to meet our customers’ requirements, while helping us maintain our position in the U.S. beef sector,” Mr. Keating said. “Our long-term commitment to U.S. beef production is unwavering. Over the past 10 years we’ve invested more than $766 million in our U.S. beef plants to ensure they remain best in class in the industry.”

Cargill does have plans in place to reopen the Plainview plant if the U.S. cattle herd rebounds, but the company said it does not expect the national herd to increase in size for a number of years.