By Tom Polansek
CHICAGO (Reuters) -Smithfield Foods, the world's largest pork processor, has stopped slaughtering pigs in the United States' so-called ham capital, where the company was founded 85 years ago.
The end of slaughtering in Smithfield, Virginia, is the latest reconfiguration for the company's namesake plant and follows a months-long internal review of its East Coast operations, Smithfield Foods said in a statement.
The company, owned by Hong Kong-listed WH Group (OTC:WHGLY), is shifting slaughtering to some of its 47 other U.S. facilities and spending $5 million to upgrade the Virginia plant to produce more packaged bacon, ham and other pork products, said Keira Lombardo, chief administrative officer.
Smithfield, Virginia, is a tourist destination based on its history as Smithfield Foods' hometown and boasts a museum featuring the world's oldest ham.
The company retooled the plant in 2019 to ship hog carcasses to China, the world's top pork consumer, and again last year to supply more pork to U.S. customers during the COVID-19 pandemic.
U.S. meat companies came under scrutiny during the pandemic as plant workers got sick and died, and slaughterhouse shutdowns highlighted supply-chain vulnerabilities.
Smithfield's facility has the capacity to kill about 10,000 hogs a day but has been slaughtering roughly 7,000 to 7,500 hogs daily, said Steve Meyer, economist for consultancy Partners for Production Agriculture. He said there are fewer hogs along the eastern seaboard after farms closed.
"Taking that plant out probably doesn't have much of an impact," Meyer said. "It leaves us snug as a country as far as hog supply verses capacity this fall."
One East Coast hog supplier, Maxwell Foods, said last year it would close and filed a breach of contract lawsuit against Smithfield Foods.
Smithfield Foods, which named a new chief executive on Friday, will reassign some of the Virginia plant's 1,900 employees within the facility and a small number will have positions available at other locations, according to the company.