Pilgrim's Pride Corp. plans to cut about 335 jobs by the end of the month, as the nation's largest chicken producer looks to reduce costs amid a slumping operating environment.
The company said the cuts represent about 1 percent of its total work force. It said the cuts are for salaried, and non-salaried positions and have been divided among nearly all of the company's three dozen locations.
The nation's meat makers, especially Pilgrim's Pride, are hurting as their profits shrink in the wake of high commodity prices for key inputs like corn and oil. Those prices are now moderating after reaching record highs this summer, but they're still high for producers. Further hurting the industry is weak pricing due to a drop in demand in foodservice and an oversupply of meat on the market.
Additionally, Pilgrim's Pride is saddled by debt due to its $1.3 billion acquisition of rival Gold Kist Inc. in early 2007. The company is considered by some analysts to be at risk for bankruptcy. Pilgrim's Pride has had to extend a temporary credit line with lenders twice since September.
The company has made other layoffs this year, including 700 cuts at a plant in El Dorado, Ark. The company announced last week it hired a chief restructuring officer.
Pilgrim's Pride said in a statement Wednesday it is notifying employees affected by the cuts this week. It said it will provide severance benefits and help finding jobs.
"Our company and our industry are facing the toughest operating environment in decades, and it is absolutely critical for Pilgrim's Pride to continue to do everything we can to operate our business as efficiently as possible," the company said in a statement.
The company's shares fell a penny to 32 cents in afternoon trading.