Pilgrim’s Pride plans $75 million expansion in Cold Spring, MN.
- Pilgrim’s Pride has announced that it is making a $75 million expansion to its production facility located in Cold Spring, MN. Construction will be complete in early 2021 and the expansion will create 130 new jobs.
- Fifty thousand additional square feet will be added to the facility to increase daily production of premium chicken products. Part of the expansion will include a new cafeteria, more break room, lunchroom and bathroom space and increased locker room capacity.
- Stearns County, the city of Cold Spring and the Cold Spring School District have approved a 10-year tax abatement to support the expansion, according to Pilgrim’s.
Wall Street applauds Pilgrim’s price-fixing deal
- On Wednesday, after Pilgrim’s Pride agreed to pay a fine of $110.5 million in a plea deal with the U.S. Department of Justice to settle price fixing allegations, the company’s stocks jumped at much as 7 percent.
- According to Stephens Inc. analyst Ben Bienvenu, this plea agreement puts the controversy in the company’s rear-view mirror. Bienvenu said that even though the DOJ investigation related to individuals is still ongoing, this agreement mitigates the risk of more significant damages to Pilgrim’s and helps remove an overhand on the stock related to this matter.
- Investors are now able to refocus on challenging fundamentals in the poultry market.
Green Plains exits cattle feeding business
- Omaha-based Green Plains Inc. has sold the remaining 50 percent of their interest in Green Plains Cattle Co. LLC, for $80 million to a group of investment funds that include AGR Partners and StepStone Group.
- Green Plains entered the cattle feeding industry in June 2014 after they purchased Supreme Cattle Feeders, a 70,000–head feedlot located in Kismet, KS.
- Since the purchase of this feedlot, Green Plains Cattle Co. grew to the fourth largest cattle feeder in the U.S. with a total capacity of more than 335,000 head of cattle across six feedlots in Texas, Colorado, and Kansas.
- In September 2019, Green Plains sold 50 percent of Green Plains Cattle Co. for $77 million in a joint venture.’
- Now that Green Plains has sold off all of Green Plains Cattle Co., the business plans to focus on becoming a world-class provider of high value ingredients. This transition will include the unveiling of the company’s high protein technology as a natural line extension to their platform.
Consumers are buying less meat to save money
- According to a new survey conducted by C+R Research, U.S. consumers are cutting back on meat and poultry purchases at the grocery store due to increased prices.
- The survey polled 2,000 consumers. Of those 2,000 respondents, 88 percent are worried about grocery prices continuing to climb, 85 percent are worried that grocery shortages will return and 65 percent have cut back on their food budgets since the pandemic hit in the spring.
- To combat the worries and save money, 43 percent of the respondents are cutting back on meat, 33 percent are eating less poultry, and 31 percent are avoiding organic items.
- As a possibility of a new coronavirus wave looms in the future, 87 percent of the respondents are concerned that a second wave will cause grocery shortages and 86 percent are worried that this situation will lead to even higher food prices.
- Long term, 77 percent of survey respondents believe that their grocery shopping habits will change permanently due to Covid-19 and 75 percent feel uncomfortable shopping at a grocery store. Almost 70 percent of the respondents have turned to grocery delivery or pick-up due to virus concerns.
Boxed beef prices
- Choice boxed beef: $210.48 (-0.66)
- Select boxed beef: $196.50 (-2.77)