Closure of potato factory has an industry worried

The Corvallis Gazette Times ^ | Wednesday, March 10, 2004 | The Associated Press

[Willie Green]

For education and discussion only. Not for commercial use.

PENDLETON — The recently announced closure of the Simplot factory in Hermiston has potato farmers throughout the state worried.

The J.R. Simplot Co., one of the world's biggest french fry manufacturers, announced it would close its only Oregon plant by the end of the year. The company will let go 125 employees by June, with 500 to follow in November,

But in addition to leaving hundreds at the plant jobless, the move will also leave millions of pounds of potatoes with nowhere to go after this growing season, producers say.

That could translate into a loss in the millions not just for growers, but for the area economy.

Fred Zerza, a spokesman for Simplot, one of the first potato processing plants in the country and one of the original plants servicing the McDonald's franchise, said the plant was closing mostly because of flat sales in its Asian export market.

"We have wound up with a significant amount of overcapacity," he said.

Potato storage facilities in Hermiston and Boardman, which handle about 70 percent of the state's potatoes, saw an increase of almost 20 percent in their potato stocks from last year.

While sales in Asia are the primary reason for the closure, the trendy Atkins diet, which has turned carbohydrates into Enemy No. 1., has hurt sales domestically. Even though there are still pockets where demand for french fries is growing, those pockets are in the Midwest and are not being served by Simplot's processing plants in the Northwest.

Bob Hale, a Hermiston grower who sells potatoes only to Simplot, said it remained unclear where his crop would go next year. "Am I surprised? No. This isn't a Hermiston issue. It's an industry issue, involving changing eating patterns, shrinking markets and excess production."

The contracts with the growers aren't signed yet, but Zerza reassured growers the company will keep commitments it has made for this growing season.

But there is no doubt Simplot's decision, especially after this growing season, is going to be felt by the agricultural community, said Bob Mueller, owner of River Crest Farms in Boardman and a commissioner with the Oregon Potato Commission.

Potato growers in Umatilla and Morrow counties reported $65.7 million in combined sales last year, according to Dallas Fridley, a regional economist for the state. Growers estimate 50 percent of that came from Simplot.

Making part of that potato market unavailable to growers could result in a culture change for the local economy. "It's going to hurt all the local growers, and severely reduce the local market," he said.

"The land normally used to grow potatoes will now be used for lesser-value crops like wheat or alfalfa. The change in land use will result in less need for fertilizers and chemicals. It's going to affect the agricultural suppliers locally."

Privately held Simplot is based in Boise, Idaho. The company, which has 12,000 employees worldwide reported sales of $3.1 billion last year.

[Willie Green]

625 Jobs Lost.

[Willie Green]

ping

[petitfour]

Mad Cow Disease strikes the economy.

[RightWhale]

McDonalds drops supersizing, fries factories founder.

[Dane]

625 Jobs Lost

Willie time for you to preach that all people who follow Atkins be tarred and feathered.

[R. Scott]

Don’t those Left Coast people care about jobs?
Don’t those Left Coast people care about the misery they are causing?
EAT SPUDS! Forget fad diets!

[Bismarck]

Problem: These french fries factories MAINLY supply firms such as McDonalds and Burger King. Too bad not enough of us have the habit of eating boiled or mashed potatoes or potato salad. In other words, these jobs are lost because the market doesn't require their product as much anymore.

[philetus]

In a related story, Chinese potato factories are now stepping up their potato production.

[woofie]

625 Jobs Lost.

625 more people who will someday die

[Dane]

Don’t those Left Coast people care about jobs?
Don’t those Left Coast people care about the misery they are causing?
EAT SPUDS! Forget fad diets!

Actually it isn't leftie Hollywood types not eating potatoes. It is conservatives following Atkins. Look up Atkins on the FR search engine.

Hvaen't touched a potato in 2 months and am 20 pounds lighter.

[Dead Dog]

low carb diets strike the economy.

[cyborg]

What a waste. Can't they send these things to some starving country that needs it?

[Dinsdale]

Not really a surprise.

I expect it's really hard for a potato factory to compete with potato farms. You know how hard they are to assemble.

[kaktuskid]

Why are the potato farmers not BUYING the plant?(ever heard of a co-op?)

[cyborg]

True. Not everyone is on the low carb diet and I'm sure some money can be made instead of letting food go to waste.

[Pan_Yans Wife]

Ah, and just last week McDonalds stated that they were removing "super-sized" items from their menu. Fewer fries, fewer fat people, fewer jobs, etc.

It's the consumer's fault! /sarcasm

[calljack]

Went to grade school with old man Simplot's oldest son.
Even in the early 60's they had so much money you wouldn't believe it. Now it is hard to count that high and I can count pretty good.

[CatoRenasci]

Indeed. I cannot have sympathy for anyone who based his business on the execreble frozen french fry. I grew up with french fries freshly made with fresh potatoes. Best ones I ever had were in Klamath Falls, made by my Aunts from their own potatoes grown on the ranch. But, even the local K Falls hamburger joints made french fries far superior to anything I've had commercially since. Even at home, we made fresh french fries until the mid-'60s.

The advent of the frozen french fry, for convenience and for the fast food industry represents another example of what Clifton Fadiman once said about pasteurized process cheese: it represents the triumph of technology over conscience.

Bah!

When french fries are fresh, I'll eat them. When frozen, I'll leave them to those who like hot greasy cardboard.

[Fierce Allegiance]

You should change your handle to
"MoreBadNews(andsometimeshigh-speedrail)WillieGreen"

[Yo-Yo]

625 Jobs Lost.

Bush knew!