NOBULL: Only six workers left at Northern Beef Packers

Only six workers left at Northern Beef Packers

By Rita Jane Gabbett on 7/25/2013

About 260 workers were laid off this week at Northern Beef Packers, leaving just six employees at the vacant plant, a local executive told Meatingplace.

The company’s president, David Palmer, contacted local media to reiterate that he still works for the company, despite an earlier statement in which he said he no longer worked for Northern Beef Packers.

Julie Johnson, executive director of Absolutely!Aberdeen, a local nonprofit group that promotes local employment, said the company advised her of the layoffs.

According to the Kansas City Star, Northern Beef President David Palmer has also resigned. Company officials could not be reached and attempts to leave messages failed.

Earlier reports said at least 50 workers had been laid off this week at the plant, which has been operating for less than a year.

At its peak, the plant employed about 400 workers, but by April plant management had to let more than 100 workers go.

The $115 million plant never got close to its original goal of processing 1,500 head of cattle per day. Last week, Northern Beef filed for Chapter 11 bankruptcy protection.

“We are hopeful here that it will land in the right hands,” said Johnson, noting there are potential buyers looking at the plant. “It needs to get through the bankruptcy reorganization. This could be a healthy process, especially since you only build a state-of-the-art beef packing plant about once every 50 years or so in this part of the world.”

Any new buyer, however, would face at least some of the same challenges that Northern Beef did, including availability of cattle to slaughter.

In a statement that accompanied the Chapter 11 filing, Palmer said, “[T]he beef packing industry has been experiencing some of its worst processing margins in recent decades, causing expected start-up costs to be much higher than anticipated. This has significantly reduced our cash position and is preventing us from meeting our current obligations.”