Building on hope
September 13, 2010
Although the past 18 months have been abysmal for the U.S. economy and difficult for many companies in the meat and poultry industry, construction of new processing plants and renovation projects, continued. As more losses are replaced by profits, the purse strings for capital-spending projects are expected to loosen up.
Below are some of the construction project highlights from the past 18 months.More than brick-and-mortar
One of the higher profile new plants to recently open is Hormel Foods’ Dubuque, Iowa-based Progressive Processing LLC plant. As a pioneer in the shelf-stable, microwaveable meals category, PP LLC began operating on Jan. 25, 2010. This new facility is expected to cost $89 million once completed. Already spanning 348,000 sq. ft. and with room to grow, it represents the first new processing facility Hormel has built in more than 25 years.
The facility began running one line of Hormel Compleats shelf-stable, microwaveable meals. Celebrating the facility’s grand opening on March 30, the facility can increase its production four-fold, with potential to produce all varieties of Hormel Compleats microwave meals, as well as CHI-CHI’s Fiesta Plates microwave meals. A canning line was being planned to complement production for products such as Hormel chili and Dinty Moore beef stew.
Mike Devine, vice president of grocery product operations at Hormel Foods, said the first goal of the Progressive Processing facility was “to get us over 100 million lbs. a year.”
A second shift was added May 17. The new facility was built according to the Leadership in Energy and Environment Design (LEED) Green Building Rating System, developed by the U.S. Green Building Council for environmentally sustainable construction. Hormel was awarded LEED certification late in July. It is one of the first manufacturing
plants – and the only refrigerated food-processing facility in the U.S. – to be LEED-certified at any level.
“When we decided to open Progressive Processing, we saw an opportunity to build a state-of-the-art sustainable facility that aligns with our strong commitment to corporate responsibility,” said Jeffrey Ettinger, Hormel chairman, president and CEO.
“We’re looking at the Progressive Processing plant as being a growth engine for the grocery products division at Hormel for the future,” Devine added.Building for future growth
Cargill Meat Solutions is building an innovation center in Wichita, Kan., that will include research, development, culinary, pilot plant and distribution capabilities. The new facility will replace a 210,000-sq.-ft. building in Wichita that was formerly a meatprocessing plant and acquired by Cargill in 1978. The company estimates this investment to total $14.7 million and construction began this past July with a completion date of June 2011.
Work continues on Sara Lee Corp.’s new, sliced luncheon meat manufacturing facility in Kansas City, Kan., which is also expected to become fully operational by 2011 and to employ more than 250 people.
“This industry-leading facility will reinforce our competitive advantage in value-added meats, one of Sara Lee’s top strategic categories and long-term growth drivers,” said C.J. Fraleigh, executive vice president and CEO of its North American retail and foodservice. “It will help us further build our Hillshire Farm and Sara Lee brands, both leaders in the fast-growing category of premium lunchmeat.”
Sara Lee plans to invest more than $130 million in the 187,000-sq.-ft. facility, which will provide the scale to develop industry-leading technological processes and give Sara Lee the capacity for long-term growth in the meat business. Officials say the plant’s new technology will facilitate innovation in cooking, chilling and packaging.On the move
Late in July 2009, Sanderson Farms announced it was moving forward in building a new poultry processing complex (a new feed mill, poultry processing plant and hatchery) on separate sites in Kinston, N.C.
The Kinston facilities will include a poultry-processing plant with the capacity to process 1.25 million birds per week for the retail market.
At full capacity, the complex will employ approximately 1,500 people, require 130 contract growers and will be equipped to process and sell 6.7 million lbs. per week of dressed poultry meat at full production. Initial operation of the new complex is scheduled to begin during the first quarter of fiscal 2011.
The company estimates its investment to be approximately $126.5 million to build the plant, which will feature two lines; both will ultimately operate on double shifts. Gold’n Plump expansion
The final phase of a multi-year expansion by Gold’n Plump Poultry was commemorated with an April 23 groundbreaking in Arcadia, Wis. This phase is part of a project that began in 2006 with the construction of a high-tech hatchery in Independence, Wis. Bought in 1993 from Arcadia Fryers to improve cost structure and better compete in its core markets, the company’s Arcadia production facility will expand by 22,000 sq. ft. and 15 percent production capacity.
Gold’n Plump has already invested an estimated $25 million in this expansion, with this phase costing about $13 million. Tyson plant improvements
Tyson Foods announced in April work would soon begin on improvements to streamline operations and add jobs at its Shelbyville, Tenn., poultry plant. It plans to spend almost $5 million to upgrade the layout of some of the plant’s chicken processing, packaging and labeling lines. The project also includes installing some new processing equipment, which will create the need for 40 additional production jobs.
“We believe these improvements will make our operations more efficient and add flexibility to our production process,” said Wally Taylor, manager of Tyson’s Shelbyville poultry complex. “This project, along with the $5.6 million upgrade of our wastewater treatment plant last fall, is consistent with our desire to reinvest in our business to ensure it continues operating successfully.”
The Shelbyville poultry complex, which includes the processing plant, as well as a hatchery and feed mill, employs more than 1,400 people. The plant produces fresh, tray-packed chicken that is sold to retail consumers. The products include de-boned and bone-in chicken, and whole birds and marinated specialty products.
Tyson Fresh Meat’s Emporia, Kan. plant has undergone a major conversion and it is running well, a Tyson Foods spokesperson told Meat&Poultry late in May. Two years ago, the facility focused on live cattle coming in and standardsize boxes of sub-primal beef going out. The facility is now focused on “a laser-beam approach on customer-centric innovation across multiple species,” the company said. The modifications have culminated in the ibp Specialty Cut Meats program. Starting in March 2008, the changes allow Tyson Fresh Meats to better meet retail and foodservice customers’ needs by focusing operations on further trimming and dividing of sub-primals and providing innovative new cuts to customer specifications. This program includes a wide variety of products allowing customers to extend their current lines, roll out private-label lines, add sliced and diced items, implement new products, add seasoned and marinated lines and utilize controlled portion cuts. The Emporia plant also operates a portion-cut pork line for foodservice and it is approved to do poultry.
For an overview of some of the industry’s more significant construction projects, see the accompanying chart
in this special report.