RANDERS, DENMARK — European pork processor Danish Crown announced last week that it plans to close its slaughter plant in Sæby, Denmark, while restructuring other parts of its organization.

The company said 800 jobs could be cut, while plans are to hire 450 new employees at facilities in Horsens, Ringsted and Blans during the next six months. Danish said weekly pig slaughter declined more than 10% in the last year with Danish Crown’s capacity exceeding its weekly hog supply each week.

With that information, the board of directors decided to close one of the company’s six facilities in Denmark.

“It is very sad that we have to say goodbye to so many skilled and loyal employees, but we are forced to react to such a marked decrease in the amount of slaughterings,” said Per Laursen, vice president of production at Danish Crown. “Now, our surplus capacity is costing us more than DKK 300 million ($44 million) a year, and it would be irresponsible in relation to the company and our owners if we didn’t take the steps which are necessary to address this challenge.”

The pork processor said inflated pork prices caused some livestock operations to close. Other places are now selling pigs for export due to high demand in Poland and Germany to generate more revenue.

To reverse that development, Danish Crown said it needed to increase the settlement price paid to the cooperative owners for the supplies to match levels paid in Germany.

“What is so frustrating about this situation is that our employees’ performance has been exemplary,” Laursen said. “But in our industry, it is imperative that the abattoirs are run with very high-capacity utilization, because otherwise it simply becomes too expensive to slaughter every single pig. But it’s a heavy decision for us all.”

Danish Crown officials hope some of the employees who worked in Sæby will accept jobs at the three slaughterhouses currently hiring employees. The processor said it would cover some travel costs or subsidize employees’ relocation costs.

Additionally, the company plans to help employees who will lose their jobs at Sæby.

“Every one of the affected employees will be invited to an interview to talk about the possibility of being employed at one of Danish Crown’s other sites,” the company said. “Alternatively, employees will be offered various options in the form of courses and training paid for by Danish Crown which can help them find other employment.”

Danish Crown also closed a plant in Germany in January 2023.