Process Management

News last update:6 Aug 2012

US poultry integrator files for bankruptcy

Allen's Family Foods, of Seaford, Delaware, has filed for Chapter 11 (reorganisation) bankruptcy, after 91 years as a US poultry integrator, setting in motion 60 days of business restructuring and industry changes.

CEO and President Robert Turley said the increase in corn from $3.50 to $8.50 was to blame, with poultry feed being it's highest input cost.

The company has 28 grow-out farms plus contracts with 271 producers between the Delmarva and North Carolina. Its 2,273 employees pack about 8-million pounds of poultry a week.

In a purchase agreement, Millsboro-based Mountaire Farms would buy Allen hatcheries in Seaford and Dagsboro, the Seaford administrative office, a Seaford feed mill, processing plants in Harbeson and Cordova and a rendering plant called JCR Enterprises in Linkwood.

Mountaire's interest in the poultry company is part of a recent expansion throughout the region. The company currently is hiring and upgrading or adding new equipment, including the addition of processing-plant lines in Millsboro and Selbyville with a goal to increase the number of growers and up chicken output by more than 10 percent, Michael Tirrell, vice president of human resources and business services said.

"We have 550 growers, and the number of chickens processed between the two towns, we need additional growers to support the additional chickens," he said. "We also are adding employees, hiring in both facilities right now."

Status of the grower contracts has not yet been determined. But Mountaire officials have indicated they'll be expanding production at two Delaware facilities to another 400,000 birds per week.

An auction is scheduled at the end of this month to sell remaining Allen Family Foods' assets.

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