-August 7,2020-
Global ag giant Archer-Daniels-Midland Company (ADM) will lay off 520 workers at several nut processing facilities in the Lodi and Modesto area confirms spokesperson Jackie Anderson.The Chicago-based trading company and food processor has some 270 plants worldwide and a number of processing plants in California.
The company filed required WARN notices this week posting that facilities in Lodi would permanently lay off 116 and in the Modesto area, some 404 employees would face permanent job loss as well, both some time in October.
Anderson says several nut plants will close.The company expanded their nut processing facilities in this area in 2015. In a news releases that year, ADM suggested consumer demand for healthy nuts drove their plan to expand.
“This acquisition helps ensure that we stay ahead of consumer demand trends, and continue to meet customer needs in a growing market.
The Modesto plant is capable of steam pasteurizing, roasting, dicing, slicing, milling and packaging. Like ADM’s plants in Lodi and Stockton, the facility can process a range of nuts, including almonds, cashews, Brazil nuts, pecans, pistachios, hazelnuts, walnuts and macadamias.”
But now the plan appears to exit this business in the Central Valley where almonds, walnuts and pistachios are heavyweights. However, this summer there is a glut of product, a huge almond crop, as COVID and the international trade war has hurt nut exports.The U.S. exports the most tree nuts but due to Chinese retaliatory tariffs and the virus demands way down as are prices.
This week The Almond Alliance of California has convinced the USDA to include almonds in their Section 32 food purchase program to the tune of $40 million.The Alliance notes
that “grower prices continue to drop and there is an anticipated 3-billion-pound crop for 2020 it is clear that the assistance of a USDA commodity purchase came at a critical time”.
Almond prices that were $3/lb year ago are half that today.Walnuts are a similar story.
One of ADM largest investment- ethanol products have been hurt by the same two factors and a number of their plants are idled in the Midwest.
ADM California plants to close
”We have informed colleagues of our plans to end tree nut processing at our facilities in Lodi and Modesto, California, in the coming months. We also plan to close our warehouse in Lockeford.”
“Our primary focus is the respect and care of our employees during this time; colleagues will have the opportunity to apply for other open roles at ADM, and regardless, we’ll be treating all of them with respect, according to our values. We’ll also be working with our customers to fulfill outstanding orders, and ensure a smooth transition.
It’s important to note that this decision is not related to the impacts of COVID-19. We regularly review our portfolio to ensure that the assets we hold are good fits. In this case, we reviewed several options, but in the end, we did not see a viable long-term path toward these facilities meeting our objectives.”