US: Sanderson puts plant construction on hold
Sanderson Farms today (26 June) said that it has placed plans to construct a new poultry processing plant on hold due to the rising price of corn and soybeans.
Construction of the US$126.5m facility, which was to be located in Kinston, will be delayed indefinitely.
Joe Sanderson, chairman and CEO, said that the group remained committed to investing in Kinston, with the future creation of 1,600 jobs proposed. However, the company did not offer a timetable for this development.
Sanderson said that the delay was the consequence of the souring cost of feed.
"The price of corn and soybeans used for feed has come under considerable pressure thanks to competing demand from the ethanol industry and the floods in the Midwest," a spokesperson for the poultry group told just-food. "Feed prices have risen to historical highs."
The company said that while its balance sheet "remains strong" it believes it is prudent to be conservative with working capital.
The plant construction was originally announced at the end of April.
Rising annual revenue at US poultry group Sanderson Farms has not been enough to stem full-year losses at the company....
Shares in US poultry group Sanderson Farms increased 6.7% yesterday (19 November) after the stock was upgraded to "neutral" from "underweight", according to reports....
Sanderson Farms has said that it is considering issuing US$1bn in new stock to fund potential acquisitions....
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