The turkey industry in the U.S. is encountering a significant crisis, and one of its major players appears to be stepping back. Cargill, a Minnesota-based company and the third-largest turkey processor in the country, is reportedly winding down its Shady Brook Farms line of turkey products, which includes burgers, sausages, and whole birds.
The Shady Brook Farms brand, which traces its roots back 112 years, has been a staple in many grocery stores, showcasing a red barn on its packaging and promoting meat free from antibiotics, hormones, and steroids. However, many retailers have informed that this brand was disappearing from their shelves as of July.
This brand has long been a go-to for many stores, particularly along the East Coast, despite its gradual decline. A distributor stated bluntly, “Cargill wants to get out of the turkey business.”
Changes are already underway. For instance, Morton Williams supermarkets addressed the supply issue by sourcing pre-packaged meat from other vendors, reducing their reliance on Shady Brook Farms by about half, according to Victor Corrello, the Meat Director at the grocery chain.
Corrello mentioned that ground turkey is a key product for them, and other stores, like the family-run Stew Leonard’s, have also noticed declines in their orders from Shady Brook Farms. “We are scrambling to find suppliers,” Stew Leonard Jr. commented optimistically about rising turkey prices in the future.
Earlier this year, Cargill confirmed that it would be closing a turkey processing plant in Springdale, Arkansas, resulting in over 1,000 job losses.
In response to the ongoing concerns, Cargill pushed back against rumors regarding a withdrawal from the turkey market. The company insisted that turkeys remain a vital aspect of its protein offerings, asserting plans to shift much of the Springdale plant’s production to facilities in Missouri and Virginia to maintain supply.
The turkey sector has been heavily impacted by recent outbreaks of avian flu, which have decimated flocks, killing approximately 19 million turkeys since 2022. A new respiratory virus, Metapneumovirus, is also affecting turkey populations, as reported by the National Turkey Federation.
Many farms have ceased turkey production entirely due to the ramifications of these outbreaks and the financial unpredictability they bring. John Zimmerman, a former federal chairman, remarked that financial institutions are wary of extending credit given current flock losses.
Turkey consumption itself has waned in recent years, capturing only 11% of the poultry market compared to a substantial 87% for chicken. Poultry expert Paul Aho highlighted that while turkey demand rose in the 1980s, it has remained stagnant, failing to match the chicken industry’s explosive growth.
Interestingly, turkey consumption peaked in the mid-1990s at 26.8 pounds per person but has since fallen, with projections showing a drop to 13.9 pounds in 2024.
Sources told that for Cargill, turkey is its least profitable protein and Shady Brook Farms has struggled to meet retailer commitments, often forcing stores to look for alternatives.
A company insider referred to Shady Brook as “Cargill’s albatross,” humorously suggesting that they should have divested from the brand long ago. The Springdale facility, one of the oldest in the company, reportedly lost $38 million in just a year due to outdated technology that significantly impacts operations.
On a broader scale, another turkey producer from California recently closed a factory, laying off 500 employees. Zimmerman noted that while these closures are driven by market choices arising from decreasing consumer demand, it shouldn’t spell doom for the turkey industry entirely.
Cargill, as the largest privately owned entity in the U.S., recorded $160 billion in revenue but saw a 10% decline in sales last year; it has also reduced its workforce by 5%.
At the retail level, Cargill continues to ensure the availability of Shady Brook Farms products to both small chains and larger retailers, including Stop & Shop and Aldi.
Corello from Morton Williams expressed concern about losing customers who have been loyal to the Shady Brook brand for years. Without it, retailers are now reaching out to brands like Butterball and Perdue while hoping they can acclimate customers to these alternatives.
