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Dive brief:
- Smithfield Foods said Monday it would spend up to $1.3 billion over the next three years on a new packaged meat and pork processing plant in Sioux Falls, South Dakota.
- The highly automated facility will be “the most modern of its kind in the United States,” the pork giant said in a statement, and will help deliver “significant efficiency gains” to the company’s fresh pork and high-value packaged meat operations.
- The building will replace the pork giant’s existing manufacturing facility in the city, which is more than 100 years old. The plant is expected to start production in late 2028.
Diving knowledge:
Smithfield is reshaping its U.S. manufacturing footprint as meatpackers grapple with rising live animal costs and look for new ways to save money.
After a period of low prices, pork costs began to rise in 2025 and are expected to continue rising this year as demand for protein increases meat sales, according to a USDA forecast. The record supply of cattle has also pushed the cost of beef to record highs, prompting more consumers to explore alternatives such as pork or chicken.
Although Smithfield is primarily a pork producer, it has slowly been expanding its presence into beef as the company looks to offer more packaged meats such as salami or roast beef. The company recently bought Nathan’s Famous Beef Hotdogs for $450 million, further exposing itself to the volatile cattle market.
To reduce costs, Smithfield has sought to simplify its supply chain and find savings through manufacturing efficiencies. The pork giant recently said it would close a dry-cured sausage plant in Massachusetts, with plans to move production to other facilities.
The pork giant’s current Sioux Falls plant employs 3,200 people and began operations in 1909 under processor John Morrell & Company, which was bought by Smithfield in 1995. The $1.3 billion investment reflects Smithfield’s strategy to grow packaged meat, which has become one of the company’s most profitable segments.
“Smithfield’s investment supports our long-term strategy to continue to grow and optimize our value-added packaged meats and fresh pork operations to deliver innovation, convenience and value to our customers.”
Other meat packers have invested in automation to squeeze savings. Cargill last year announced a $90 million investment in computer vision technology for its Fort Morgan, Colo., plant that allows the manufacturer to process more meat per cow.
