October 30, 2012 / 9:36 PM / 5 years ago

U.S. livestock industry unbuffeted by Sandy

CHICAGO (Reuters) - Poultry producer Perdue Farms Inc kept four of its processing plants and a distribution center in the northeast shut down for a second day, as monster storm Sandy brought heavy flooding along the coastal communities of the Delmarva Peninsula, a company spokeswoman said Tuesday.

Perdue said it closed down the facilities on Monday in preparation for the hurricane, which has killed 18 people and left a wide swath of the eastern United States struggling with epic flooding and massive power outages.

On Tuesday, as the storm system continued its trek inland, Perdue spokeswoman Julie de Young said two of the farmers who raise chickens for the company had experienced “extensive flooding” and that many of the other farmers were relying on generators to power their operations and ventilation equipment for the chicken houses.

But as word of storm damage to the nation’s livestock sector began to trickle out Tuesday, the news appeared to be relatively positive.

Tyson Foods’ (TSN.N) poultry processing facility in Temperanceville, Virginia, was closed on Tuesday and is scheduled to reopen on Wednesday, said company spokesman Worth Sparkman. No damage was reported at any of Tyson’s facilities within reach of the storm, he said.

In Landover, Maryland, Smithfield Foods SFD.N, the largest pork producer and hog processor in the world, opted to keep its plant there shut on Tuesday because of the storm, but planned to resume operations on Wednesday, said Smithfield Foods’ spokeswoman Kiera Lombardo.

The company did not say whether it experienced any storm damage to its facilities.

In Wyalusing, Pennsylvania, Cargill Inc CARG.UL said it ran its beef processing plant on Saturday to produce extra product to supply its customers during the brunt of the storm, Cargill spokesman Mike Martin said via an e-mail.

The company cut back the plant’s operating hours on Monday, and Martin said the facility was back to normal operations by Tuesday. But he cautioned that “our response may be impacted by potential infrastructure damage to utilities, roads and other vital elements of the supply chain in the region.”

Perdue Farms, which also had minor flooding at one of its plants, was hoping to reopen its distribution center by late Tuesday if the roadways were safe for drivers and employees to travel, de Young said.

The Delmarva Peninsula is a hub for poultry production, with about 15,000 people working in the chicken industry - from farmers raising birds to processing plant workers, according to data from the Delmarva Poultry Industry’s website.

“Right now there’s a travel restriction in Delaware,” de Young told Reuters on Tuesday. “We need to make sure everything’s safe” before the center reopens.

Perdue, which became the third-largest poultry producer after acquiring Coleman National last year, was also waiting to see whether roadway conditions would allow it to reopen its four processing plants on Wednesday.

    Four of the company’s processing facilities are on the Delmarva coastal area, de Young said.

    Company-wide, Perdue Farms has 2,116 poultry producers raising chickens and turkeys. It produced nearly 3.1 billion pounds of meat in 2010, according to the company’s website.

    “There’s a bit of a sigh of relief that the storm damage hasn’t been worse,” de Young told Reuters on Tuesday.

    The market seems to share that sentiment, as livestock prices recovered from a recent price plummet amid concerns over storm-fueled disruptions of consumer and restaurant demand along the northeast.

    New Yorkers spent almost $7 billion on beef in 2010, making it the third-largest consumer of beef based on dollars spent, behind California ($13.3 billion) and Texas ($9 billion), based on data compiled by the National Cattlemen’s Beef Association.

    On Tuesday, Chicago Mercantile Exchange October live cattle closed up 0.525 cent per lb to 125.900 cents. December was up 0.925 cent to 126.200 cents.

    CME December hogs ended up 0.300 cents per lb to 78.100 cents. February closed at 83.875 cents, up 0.625 cent.

    Reporting by P.J. Huffstutter; editing by Prudence Crowther

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