BRF plans to temporarily close its poultry processing plant in Carambei, Brazil, effective May 27.
According to a Reuters report, the company announced it would suspend production at the plant, located in the Brazilian state of Parana, for as many as five month in an effort to balance supply and demand.
BRF, in a statement, said its market will be supplied from other plants within the company.
The latest decision to halt operations in Carambei comes almost exactly a year after the company announced it would place about 1,300 workers at the plant on paid leave. At the time, the Brazil-based meat and poultry company said putting the workers on leave in Carambei, and an additional 2,300 workers on leave in Rio Verde, was a way of adjusting production and capacity following a government-imposed trade ban affecting exports to the European Union.
BRF, which according to the WATTAgNet Top Poultry Companies Database is the second largest poultry company in Brazil and the third largest in the world, has been through some financial struggles in recent years, and experienced a net loss of BRL4.47 billion (US$1.2 billion) for the 2018 fiscal year.
Company executives called 2018 the “most challenging year in BRF’s 10-year history," in which it saw protectionist measures aimed to close major import markets, cost pressure in domestic markets, logistical issues posed by a trucker strike, and a second round of police investigations centered around the Operation Weak Flesh scandal. The company also cited difficulties with governance and a lack of structure within its teams.
In an effort to regain profitability, BRF has divested of assets in Argentina, Thailand and Europe so it could focus on its domestic operations, as well as those in regions with a higher Muslim population. In February, Tyson Foods agreed to acquire BRF’s Thai and European operations.