American Foods Group said it is closing its hog slaughter plant in Huron, South Dakota, effective Friday, and selling the closed facility to John Morrell and Co, a sudisidiary of Smithfield Foods Inc.
The Huron facility has the capacity to slaughter 7,500 hogs per day. American Food Group unit Dakota Pork Industries Inc employed 850 people at the facility.
"With the hog slaughtering industry beset by virtually unprecedented hog prices, and in view of other economic conditions, we opted to sell this facility to Smithfield Foods Inc," said American Foods chief executive officer Carl Kuehne.
"Industry production capacity is out of relationship with the current supply of hogs," Kuehne.
Smithfield Foods said it had no immediate plans to re-open the facility.
"We are buying a plant that has been closed. At this stage of the game we're going to take a look at all the options with regard to the plant but in the near term we will not be killing hogs there," a spokesman for Smithfield Foods said.
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