Workers' strike at one of the largest US meatpacking plants will continue for a 3rd week

“The workers know the value of their labor,” union President Kim Cordova said Friday. “This could be a long, drawn out fight.”

Owner JBS USA said Friday that it's operating the plant at limited capacity and has shifted beef production elsewhere to meet customers needs.

With negotiations stalled, the company remains in a strong position relative to the striking workers, said Jennifer Martin at Colorado State University’s animal sciences department.

That's because the industry is suddenly less burdened by excess slaughter capacity that had been keeping profit margins low. Now amid the Greeley strike and other slaughter plant capacity reductions — including the closure of a major Tyson Foods’ plant in Nebraska — companies are seeing profits increase, Martin said.

“It’s not necessarily in favor of the employees,” she added. “The lack of harvest capacity at one facility right now might actually be a benefit to the larger industry in the sense of improving (profit) margins.”

It’s the first strike at a U.S. slaughterhouse since workers walked out at a Hormel plant in Minnesota in 1985. That strike lasted more than a year and included violent confrontations between police and protesters.

The Greeley strike began with support from 99% of the plant’s 3,800 workers who belong to the United Food and Commercial Workers Local 7 union. Thousands have showed up at the picket line over the past two weeks.

Union officials say the company’s offer of 2% wage hikes is less than inflation.

JBS said its contract offer is consistent with a deal reached with UFCW union workers at other plants. But Cordova said Colorado has a higher cost of living than those other locations and health care costs ate up much of the wage increase.

JBS is the world’s largest meatpacking company with a market capitalization of $17 billion. It's the top employer in Greeley, a city 50 miles (80 kilometers) northeast of Denver with a population of about 114,000 people.

“We are maintaining supply, supporting the long-term stability of the beef chain, and minimizing disruption for producers, customers, and consumers,” JBS spokesperson Nikki Richardson said in an email. “Our priority is to keep product moving while we work toward a resolution in Greeley.”

In 2020, the Greeley plant was the scene of Colorado’s deadliest workplace coronavirus outbreak, with 291 infections and six deaths among plant workers. During the outbreak, President Donald Trump issued an executive order to keep meatpacking plants across the U.S. open over concerns about the pandemic's impact on the nation’s food supply.

Federal regulators later fined JBS $15,615 for failing to protect its employees.

In the wake of the pandemic, beef companies invested billions of dollars to increase slaughter capacity and ensure enough meat would be available for consumers, Martin said.

But recent years have seen U.S. cattle numbers drop to a 75-year low, driven in part by drought and low prices offered to ranchers. That's meant the additional slaughter capacity is not as needed, Martin said.

JBS was approved for trading on the New York Stock Exchange last May, despite environmental opposition and a federal probe that led to its guilty plea for bribing Brazilian officials for the financing it used for its U.S. expansion.

Brown reported from Billings, Montana.