NACOGDOCHES-LUFKIN, TX (KTRE) - Pilgrim's Pride, the nation's largest chicken producer and largest employer in Nacogdoches County is inundated with phone calls from investors. The company's stock is plummeting. Earlier this week stocks fell 38% and then followed by another drop close to 40%. The company blames high feed costs, weak pricing and a lower demand for breast meat.
As a Pilgrim's Pride grower, Mike Meador gets a pit in his stomach when he hears about the Pilgrim's Pride troubles. " You have that question in back of your mind, will you still be raising chickens on the next batch and we hope and we pray that we still are. " And as the president of the Nacogdoches Farm Bureau Meador becomes concerned for all the others associated with the largest employer of Nacogdoches County. " There's a whole different levels of people that are working for Pilgrim's Pride. We've got people producing breeders and here where I produce broilers. It's just a lot of people. " Not to mention loan officers, suppliers, processing employees and the list goes on.
Company spokesman Gary Rhodes attempts to ease the anxiety. He told the East Texas News today, "There is no direct impact on facilities in the Lufkin-Nacogdoches area. It's business as usual. We plan to continue to serve our customers with no interruptions and go forward. "
Yet Rhodes lists the closure of plants and elimination of positions as steps recently taken to improve business efficiency. The question on a lot of people's minds is, could something like that happen here. Commercial Bank President, Tommy Ellison said, " That's going to be the concern for everybody any time you have a major employer that's made an announcement they've had some earnings issues, but I would tell you we're optimistic that those will be temporary in nature. We hope that the management is going to be able to work through that. "
Pilgrim's Pride competitor Tyson foods has facilities in east Texas too. That producer is also hurting, but no where near the extent of Pilgrim's. That's due in part to the large debt Pilgrim's owes after buying out rival Gold Kist Incorporated last year.
Meador believes he's seeing cutbacks first hand. His upgraded poultry houses are sitting empty one week longer than usual. " They're probably trying to reduce the amount of birds and the amount of product in the pipeline to try to raise prices a little bit. When I don't have birds, I'm not making money. "