Coronavirus to slow US meat production for months, CEO says
Head of the biggest US beef producer says JBS is revamping operations and has hired 1,000 workers to do extra cleaning
Pat LaFrieda Meat Purveyors Owner Pat LaFrieda argues meat shortages are overhyped.
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The coronavirus will likely hamper U.S. meat production for months, as new safety measures and reduced staffing slow plant operations, said the head of the biggest U.S. beef producer.
JBS USA Holdings Inc., which slaughters 23% of the country's cattle and produces nearly one-fifth of its pork, is revamping plant operations to space workers farther apart while about 10% of its workforce has been sent home because of their higher risk from Covid-19, Chief Executive Andre Nogueira said.
A shopper pushes his cart past a display of packaged meat in a grocery store in southeast Denver. (AP Photo/David Zalubowski)
"We will not be able to go to full capacity anytime soon as we fight this virus because of all the changes we have implemented," Mr. Nogueira said in an interview.
JBS, a unit of Brazilian meat conglomerate JBS SA, last month closed several of its beef and pork plants around the country after coronavirus infections spread among plant workers, prompting calls from union and local health officials to shut down facilities. Other meat companies, including Tyson Foods Inc., Smithfield Foods Inc. and Cargill Inc., also temporarily closed plants.
President Trump in late April issued an executive order aimed at speeding meat plants' reopening, and easing the coronavirus's disruption to the U.S. food system. With meatpacking plants closed and slowed, U.S. supermarkets are dealing with shortages and surging meat costs. Hog farmers, unable to send livestock to processing plants, have turned to euthanizing them by the thousands. R-Calf USA, a cattle rancher group, this week estimated that around 500,000 cattle were backed up on feedlots and unable to be slaughtered.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| JBSAY | JBS | 12.202 | -0.13 | -1.04% |
"Will we have all the items in the grocery store? Probably not for the next several weeks, but at this point I am not concerned about a shortage of protein," Mr. Nogueira said. He said JBS is selling more meat domestically rather than exporting it.
JBS has reopened plants that it closed in Pennsylvania, Colorado, Minnesota and Wisconsin. So far, those are operating at 70% to 95% of their normal capacity, a company spokesman said.
Hundreds of JBS plant employees have stayed home in recent weeks, either because they were sick or out of concern for their health, according to company and union officials. Mr. Nogueira said safety measures the company is putting into its plants, such as air-purification systems equipped with ultraviolet lights, are helping employees feel better about coming in to work as plants reopen.
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Around 6,000 JBS employees -- those over the age of 60 or who have health conditions that put them at greater risk from the coronavirus -- have been directed to stay home and are being paid, Mr. Nogueira said.
JBS has hired 1,000 new workers in response to the coronavirus in recent weeks, he said. Roughly half of those are doing extra cleaning in break rooms, hallways, bathrooms and other high-traffic areas, while the other half are teaching workers how to use protective gear and are monitoring social distancing.
In Greeley, Colo., JBS runs one of its biggest beef plants near the company's U.S. corporate headquarters. The company closed the plant for about two weeks as Covid-19 infections spread among employees, reopening April 24. Since then, infections among plant employees have climbed to 319 this week from 245, according to state health department data. JBS employs more than 3,000 people at the plant. A spokeswoman for the local United Food and Commercial Workers International Union representing JBS's Greeley plant employees said enforceable laws to protect workers are needed, along with federal work safety inspections.
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A JBS spokesman attributed most of the new cases to state-sponsored tests while the plant was closed. The company is offering free testing to Greeley plant employees and is screening them for symptoms before their shifts, he said.
JBS's beef-processing plant in Souderton, Pa., was the first major U.S. meatpacking facility to close in early April following a Covid-19 outbreak among workers. After reopening the week of April 20, no new cases have been confirmed among JBS employees, according to county health and union officials.
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Wendell Young, president of the local UFCW chapter that represents JBS employees, said closing the facility stopped the virus's spread there and gave time to space out workers and put up barriers between their stations.
JBS's Mr. Nogueira said it wasn't clear whether shutting down the company's plants helped slow the coronavirus's spread in communities like Souderton and Greeley, because cases continued to increase even when the plants were shut down. He said closing the plants nevertheless was the right decision and that the company could still close more facilities if needed.