BROOKS, Alberta, May 11 /PRNewswire-FirstCall/ -- Lakeside Packers will
soon take another step in the effort to reduce the oversupply of Canadian
cattle.
The chief executive of Tyson Foods (NYSE: TSN), which owns Lakeside, today
announced that the Alberta plant plans to begin increasing its beef slaughter
capacity in mid-June. The change is the result of a $17 million plant
expansion project, which has been underway since last fall. The Lakeside
plant has been operating at maximum capacity for much of the past year and a
half because of record-large Canadian cattle supplies.
"Our investment in this project will help address the backlog of cattle
caused by the continued closure of the U.S. border," said John Tyson, chairman
and chief executive officer of Tyson Foods, who visited the Lakeside plant
Wednesday. "It also reflects our long-term commitment to the Alberta beef
industry, which we fully expect to rebound from the market challenges of the
past two years."
The plant's capital investment has involved expanding the plant's beef
carcass coolers and streamlining parts of the beef slaughter operation. The
changes will increase Lakeside's beef slaughter capacity from approximately
3,800 cattle per day to 4,700. While some aspects of the project will not be
finished until fall, enough have been completed that plant officials expect to
begin gradually ramping up production next month.
The specific timing will largely be driven by the company's ability to
hire additional workers. The expansion is expected to create as many as
300 additional jobs, eventually increasing the plant's workforce to 2,700 Team
Members.
Tyson Foods also continues to support efforts to reopen the U.S. border to
Canadian cattle. Last month the company filed a brief in support of a U.S.
Department of Agriculture (USDA) appeal of a court decision that has delayed
the reopening of the U.S. border to Canadian cattle imports. The company
brief calls the court decision "bad" law and "bad" for consumers and notes
there is no scientific basis for keeping the border closed.
A preliminary injunction was granted in early March by a federal judge in
Montana at the request of the Ranchers-Cattlemen Action Legal Fund (R-CALF).
The injunction has prevented implementation of USDA's minimal-risk rule, which
would re-establish U.S. trade with Canada for live cattle less than 30 months
of age.
According to the amicus brief Tyson filed with the 9th Circuit Court of
Appeals in San Francisco, the injunction should be lifted and the final rule
should be permitted to take effect.
"The U.S. beef industry is part of a North American market and we believe
it's imperative for there to be a harmonization of trade rules with Canada and
Mexico," Tyson said.
Tyson continues to run its U.S. beef plants at reduced levels of
production due, in part, to the continued U.S. ban on Canadian cattle. About
three to five percent of the cattle purchased for the company's domestic
plants have historically come from Canada. Earlier this year the company
temporarily suspended operations for more than a month at four plants as well
as second shift processing at another facility.
Lakeside Packers, part of Lakeside Farm Industries, began operations in
1974 as a beef slaughter operation. IBP, inc. bought Lakeside in 1994 and
added a boxed beef processing operation. IBP was subsequently acquired by
Tyson Foods, Inc. in 2001.
Tyson Foods, Inc., founded in 1935 with headquarters in Springdale,
Arkansas, is the world's largest processor and marketer of chicken, beef, and
pork and the second-largest food company in the Fortune 500. The company
produces a wide variety of protein-based and prepared food products, which are
marketed under the "Powered by Tyson(TM)" strategy. Tyson is the recognized
market leader in the retail and foodservice markets it serves, providing
products and service to customers throughout the United States and more than
80 countries. Tyson has approximately 114,000 Team Members employed at more
than 300 facilities and offices in the United States and around the world.
Forward-Looking Statements
Certain statements contained in this communication are "forward-looking
statements" such as statements relating to the anticipated increase in
slaughter capacity and number of jobs created. These forward-looking
statements are subject to risks, uncertainties and other factors, which could
cause actual results to differ materially from historical experience or from
future results expressed or implied by such forward-looking statements. Among
the factors that may cause actual results and experiences to differ from the
anticipated results and expectations expressed in such forward-looking
statements are the following: (i) fluctuations in the cost and availability of
raw materials, such as live cattle, live swine or feed grains; (ii) market
conditions for finished products, including the supply and pricing of
alternative proteins, and the demand for alternative proteins; (iii) risks
associated with effectively evaluating derivatives and hedging activities;
(iv) access to foreign markets together with foreign economic conditions,
including currency fluctuations and import/export restrictions; (v) outbreak
of a livestock disease which could have an effect on livestock owned by the
Company, the availability of livestock for purchase by the Company, or the
Company's ability to access certain markets; (vi) successful rationalization
of existing facilities, and the operating efficiencies of the facilities;
(vii) changes in the availability and relative costs of labor and contract
growers; (viii) issues related to food safety, including costs resulting from
product recalls, regulatory compliance and any related claims or litigation;
(ix) adverse results from litigation; (x) risks associated with leverage,
including cost increases due to rising interest rates or changes in debt
ratings or outlook; (xi) changes in regulations and laws (both domestic and
foreign), including changes in accounting standards, environmental laws and
occupational, health and safety laws; (xii) the ability of the Company to make
effective acquisitions, and successfully integrate newly acquired businesses
into existing operations; (xiii) effectiveness of advertising and marketing
programs; and (xiv) the effect of, or changes in, general economic conditions.
SOURCE Tyson Foods, Inc.
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Related links:
http://www.tyson.com
CONTACT:
Gary Mickelson of Tyson Foods, Inc.,
+1-479-290-6111
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