Consumer sentiment remained sour. Demand didn't return. Big business customers kept their ties cut.
The result was Monday's announcement by Beef Products Inc. — the nation's largest producer of a much-scrutinized ground beef filler known by detractors as “pink slime” — that it will permanently close three plants where operations had been suspended, including one in Waterloo, Iowa.
The Waterloo facility, along with the other plants, in Amarillo, Texas, and Garden City, Kan., accounted for 650 jobs. The Iowa factory alone employed 200 people.
“While we had hoped to be able to resume operation at those plants, that is not going to be possible in the immediate future,” said Rich Jochum, a company spokesman.
In the statement, BPI said the jobs will be eliminated on May 25.
Operations at the company's main plant in South Sioux City, Neb., will continue, the company said. It's operating at a reduced capacity but the company hopes to boost that as market conditions allow.
The company's processed ground beef trimmings, known in the industry as lean, finely textured beef, came under fire after blog and media reports spotlighted the filler's usage by school lunch programs.
As the debate continued, several grocery chains and fast-food restaurants decided not to carry products with the filler, saying consumers had indicated they didn't want it. Consumers said they felt misled by the lack of labeling and were concerned they were paying premium prices for a lesser product.
The reaction was so swift and so strong that BPI's sales dropped by half in March.
The uproar, along with a case of mad-cow disease detected in a dairy cow in California last month, sent cattle futures to a low of $1.1157 on April 24. Since then prices have improved, but they are still down about 7 percent for the year. Those issues, combined with high fuel and livestock feed prices, are expected to send ground beef prices to all-time highs in the coming months.
The U.S. Agriculture Department does not require labeling of the ground beef filler because it's considered 100 percent beef. The agency has since adopted a voluntary labeling program.
Iowa Gov. Terry Branstad, a staunch supporter of BPI and its product, said in a statement Monday that his office will keep fighting for the lost jobs.
“I continue to hope that as consumers learn about this safe, healthy and lean food, they will understand what a great product lean, finely textured beef truly is,” he said.
Sen. Chuck Grassley, R-Iowa, said, “It's a real shame that a smear campaign of misinformation that neither accurately describes lean, finely textured beef, nor is fair to the hard-working people who make it, is costing a lot of people their jobs today.”
He said there wasn't enough time “to educate the public about the company's process that was approved by the Food and Drug Administration, and used in hundreds of other foods, besides beef, that's been consumed safely for more than 20 years.”
BPI has a beefisbeef.com website that it hopes will rebuild demand. At its peak, lean, finely textured beef was in about 70 percent of all ground beef.
The company, a family-owned operation based just over the Nebraska border in Dakota Dunes, S.D., is known for its innovations in food safety. It makes only the beef filler, and company officials have said it doesn't have another product it can make and sell in the interim.
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