"Pink slime" may force BPI corporate staff cuts

CHICAGO Tue May 8, 2012 6:36pm EDT

CHICAGO May 8 (Reuters) - Beef Products Inc, the leading U.S. producer of a lean ground beef filler that critics have dubbed "pink slime," said Tuesday that the media furor that led it to close three of its four plants and lay off 650 people could also result in cuts to its corporate staff.

The South Dakota-based company employs 152 people at its corporate office, according to corporate administrator Rich Jochum.

On Monday, BPI said it would shut down its plants later this month in Amarillo, Texas; Garden City, Kansas; and Waterloo, Iowa.

"Regrettably, this evolving situation has also forced us to begin to evaluate the impact these changes in production may have on our corporate personnel," the company said in a statement Tuesday.

Jochum said in a separate statement, "While the scope and timing of any activity here has yet to be established, we would anticipate only a portion of employees will be impacted."

BPI's remaining plant in South Sioux City, Nebraska, is expected to continue to operate, though at a reduced capacity, according to the company.

Before Monday's closures, BPI employed nearly 1,500 people at its plants and its headquarters in Dakota Dunes, South Dakota.

In March, a public outcry erupted over the filler for ground beef, which is made from fatty trimmings that are potentially more susceptible to contamination than other cuts of beef. The trimmings are sprayed with ammonia hydroxide to curtail the growth of pathogens such as salmonella and E.coli O157:H7.

Sales plummeted when consumers became aware of the common practice in the industry, despite U.S. Agriculture Department and industry experts saying the beef was safe to eat.

Two of the biggest U.S. supermarket operators, Safeway Inc and Supervalu Inc, have said they would stop buying beef blended with BPI's filler. McDonald's Corp stopped using ammonia-treated meat in its hamburger products last summer.