Meat and Poultry Industry News / Beef

Closing of Brawley plant will lead to $100 million hit to local economy

February 11, 2014
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Local officials in Brawley, Calif., have been in talks with National Beef Packing Co. and its parent company, Leucadia National Corp., to put together a package that would compel the company to keep its plant open and the 1,300 workers employed. National Beef announced on January 31 that it was closing the plant, effective early April.

According to the Imperial Valley Press, closing the plant would result in a $102 million hit to the local economy, according to Michael Bracken, managing partner and chief economist with Development Management Group.

Every worker at that plant in turn is responsible for another eight-tenths of a job, according to economic models being used by Bracken.

In other words, he said those 1,300 production, fabrication, maintenance and transportation jobs at National Beef support another 1,040 jobs in the regional economy.

“Based on a cursory look, the loss of $102 million annually and a total loss of 2,340 jobs directly and indirectly, unemployment will shoot up 5 to 6 percent,” Bracken said. “This is one of the most devastating economic events that could happen to the Valley,” he added.

Local feedlots that deliver cattle to National Beef are not accepting additional animals unless they can find a new meat-processing facility to take their present inventory. At least one cattleman has said he is considering moving his cattle to the Midwest to be closer to the majority of beef-processing plants. The local alfalfa consumption will also drop, adversely affecting the area farmers as well.

Source: Imperial Valley Press

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