Business

Chicken processor to close two NC plants

Posted July 29, 2011 11:18 a.m. EDT
Updated July 29, 2011 8:04 p.m. EDT

— The Townsends Inc. chicken plants in Siler City and Mocksville are closing, leaving more than 500 employees out of work, Siler City Mayor Charles Johnson said Friday. 

Johnson said the rise in grain costs and fuel prices played a part in the decision to close both plants. He said the closing of the Siler City plant, the largest employer in town, will be devastating to the community.

The Siler City plant employs 550 workers, while the Mocksville plant has 130 workers. 

"It's very shocking and sad," Johnson said.

Johnson said the closures will especially affect chicken farmers in Chatham County and surrounding areas who work on a contract basis with Townsends. 

Siler City chicken farmer Charles Moore said 90 percent of his business comes from Townsend. He said the closure means he will probably only be able to keep his business afloat until the end of the year. 

"We're kind of bottom of the line, but we're trying to do our best," Moore said. 

The Siler City plant is expected to close by Oct. 1.

In May, the chicken processor announced plans to eliminate 145 jobs at the Siler City plant, 1101 E. Third St., during the first week of July.

Townsends Inc. filed for Chapter 11 bankruptcy protection in December, saying it had more than $100 million in liabilities because of a combination of high feed costs and low prices for chicken. Omtron Ltd., an affiliate of Agroholding Avangard, Ukraine’s largest egg producer, bought Townsends' North Carolina plants, its headquarters in Delaware and other assets for $24.9 million.

Following the sale, Johnson said town leaders hoped Townsends would remain active. He said the plant meant tens of millions of dollars to the local economy. 

"This money is mostly spent in the Siler City area," Johnson said. 

WRAL News' calls to Omtron were not returned on Friday.