Jobs Coming to Northeast Arkansas

Thursday, March 13, 2014
Gov. Mike Beebe (left) with Peco Foods Chairman and CEO Mark Hickman during Monday's announcement in Little Rock. (courtesy photo)

The Arkansas Economic Development Commission made it official Monday, March 10, with the announcement of a major project coming to Northeast Arkansas which should bring 1,000 new jobs to Clay and Randolph counties.

State and county leaders were joined by company officials with Peco Foods, Inc., as they made the announcement in the governor's conference room at the State Capitol, concerning a project which has been in the works for months.

Mark Hickman, president and CEO of Peco Foods, was joined by Gov. Mike Beebe, Delta Regional Authority Federal Co-Chairman Chris Masingill and leadership from the two counties in making the announcement.

"We are extremely pleased to formally announce this new project today," Hickman said of the effort. "Arkansas is an excellent place to do business, and we look forward to providing new jobs and an economic boost to Randolph and Clay counties. As we have experienced firsthand with our complex in Batesville, this state is home to an outstanding workforce that shares the goals and values of our company. I want to thank Governor Beebe and his team for their assistance in making our Northeast Arkansas expansion a reality -- we look forward to a long and very successful partnership."

The matter was first broached at the January meeting of the Clay County Quorum Court, as Peco Foods official Gerald Noland indicated the company planned to expand into both Clay and Randolph counties. Currently, the company operates facilities in both Newark and Batesville in Arkansas along with plants in Alabama and Mississippi.

The plan calls for the construction of a fully-integrated poultry processing plant just outside the Pocahontas city limits, and a feed mill just north of the former Hart's building in the Corning Industrial Park.

The larger of the two complexes will be the Pocahontas location, which will house all aspects of the poultry operation, including such facilities as a hatchery, feed mill and processing plant. Company officials note the plant will be fully automated, but could produce as many as 1,000 jobs.

Noland told members of the quorum court the Corning facility would employ about 55 full-time workers, who would oversee day-to-day operations of the primarily-automated feed mill.

To facilitate the project the JP's agreed to issue revenue bonds to construct and operate the Clay County facility, which will be located on 165 acres of land. The bonds, which equated to about $36.5 million, will be used to construct the building and to provide needed machinery and equipment to begin the operations.

"When Peco Foods acquired an existing Arkansas facility a few years ago, it made a significant investment in the workers of Northeast Arkansas," Gov. Beebe said of the plan. "That investment has ultimately led to this major expansion. We are here today because Peco Foods knows the workforce in Randolph and Clay counties has the necessary skills to take the company to the next level of success."

Peco Foods is listed as the eighth largest poultry supplier in the United States, but has flown largely under the radar with only five percent of its business within the retail sector. The firm's largest customer is Buffalo Wild Wings, but it also services McDonald's and several other large franchises.

The firm is considered one of the largest privately-held poultry companies, and showed considerable growth after purchasing the former Batesville-based Townsend Company in 2011.

Company officials note the new plant in Northeast Arkansas will process in excess of 1.4 million chickens per week. Meanwhile, company-wide the firm processes about 24 million pounds of poultry each week.

The process of choosing the location was lengthy, with officials of the Alabama-based firm searching for an appropriate locale. "We wanted a place that could meet the supply of crops we require," Noland explained. "Clay County was the perfect location.

Company officials also pointed to the need for an adequate rail system, and found Corning's location to be ideal. They also indicated the production of local corn, milo and wheat was also a significant factor.

Noland explained the chickens would require about 15,000 tons of food per week to service the 620 chicken houses being planned. This equates to about 127,000 acres of corn to run the mill each year or roughly about $100 million in corn.

This requirement helped lead company officials to Clay County, which includes 120 to 140 growers within a 50-mile radius of the operation. Planners also noted the location would be convenient and complement the other Arkansas operations as well as those in Alabama and Mississippi.

The Corning feed mill would accommodate some 200 truckloads of corn per day, using quick unloading procedures and a five-minute sample test.

Groundbreaking on the Clay County location should be held sometime in April, and the construction is expected to take about 18 months. Company officials said buying grain should begin during the 2015 harvest season.

The complex at Pocahontas comes with a $120 million price tag and will be constructed about two miles south of the city limits. The company will also build a supporting hatchery and truck shop along U.S. Hwy.67, adding another $20 million to the investment. Work on the Randolph County facilities is expected to be underway by July.

Company officials note the processing plant should start operations by January of 2016 with about 300 workers, and expect employment to increase to 900 to 1,000 by the start of 2017.

Along with more jobs for the region, the new facilities will also offer new options to producers and other opportunities for the agricultural community. Andy Vangilder, staff chair of the Clay County Cooperative Extension Service, noted the impact should be widespread.

"If this is as big as they say it's going to be there is going to be it will make a big difference for the region in several ways," he noted. "Of course, the first thing would be the new market for local grain. If they wanted to they could buy every bit of corn, wheat and grain sorghum we produce in Northeast Arkansas. They will be bringing in a lot of grain by rail -- that's one of the reasons they liked the Corning location -- but it does open up a new market for producers."

Vangilder noted the chance to sell grain locally will also affect other prices. "Most of our grain goes to the river, and if there is another option for selling locally it's going to force those guys to re-think the matter and try to be more competitive on prices in order to continue to be able to purchase grain. Anytime there is more competition it's good for our growers...this can only mean positive things for our producers."

He also pointed to the additional jobs generated by the presence of Peco Foods, noting other opportunities may exist. "This will generate a lot of jobs for the company and producers, but it may also offer the chance for Clay County producers to get into the poultry business," Vangilder explained. "It's not always easy to make a living farming on the ridge and this may offer the perfect chance for those interested in building poultry houses."

Vangilder also noted there will be another benefit for area farmers, the availability of chicken litter as a fertilizer. "Our producers just love to put poultry litter on their fields, but the limited amount available locally, and the cost of transportation, hampers their ability to afford it," he noted. "They have problems with that issue in Northwest Arkansas where they've been putting four to five tons a year on some farms for a long time -- but we're only looking at one to two tons a year so there wouldn't be any adverse impact. It would be good for local producers and good for the soil of Northeast Arkansas."

"Peco Foods expansion of operations in Northeast Arkansas is a vote of confidence in the infrastructure, workforce and business environment of Arkansas and the Delta region," Chairman Masingill added. "We are proud to support Randolph and Clay counties in ensuring the necessary land and infrastructure to attract and retain great businesses like Peco Foods, so that they may create jobs for our Delta workers."

Peco Foods first started as a small hatchery and feed mill in Gordo, Ala., in 1937. In the years since it has grown into a fully-integrated poultry processing and packaging company which guarantees fresh delivery in less than 72 hours anywhere in the continental United States.

Headquartered in Tuscaloosa, Ala., Peco Foods has processing plants located throughout Mississippi, Alabama and Arkansas. Those wanting more information on the firm may visit their website at www.pecofood.com

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