Posted 2/24/2014 12:00 am
Updated 7 months ago
Land has changed hands, financing is lined up and a formal announcement is expected March 10.
Peco Foods Inc. of Tuscaloosa, Ala., will unveil plans for a new integrated poultry operation in northeast Arkansas that weighs in at more than $165 million.
The development, first reported by Arkansas Business in early November, is viewed as the best manufacturing news in years for Randolph and Clay counties.
The most recent unemployment tally for Clay County is 12.2 percent and in Randolph County 9.3 percent. Both are preliminary figures for December.
“Peco is really going to be a big lift,” said a community leader in Corning (Clay County), who like others spoke on condition of anonymity. “They’ve been looking in the area for three to four years. We’ve been working with them since last May.”
Peco officials declined to be interviewed about the project in deference to the planned announcement at the Governor’s Office next month. Civic leaders in both counties were hesitant to talk about the development in advance of the press conference, although the project is something of an open secret locally.
Starting employment at the inter-county poultry operation is pegged at 350, a payroll that could increase toward 1,000 in the months following the plant’s scheduled January 2016 opening.
Peco will develop a poultry processing plant and supporting hatchery and truck stop facility about 2 miles south of Pocahontas (Randolph County). The plant will be built on a nearly 200-acre site near the northeast corner of Highway 90 and U.S. 67.
The company also will develop a feed mill-grain storage facility on the northern outskirts of Corning on a 168-acre site along the Union Pacific rail line.
The farmland property is north of the old Hart’s Furniture plant.
Employment here is expected to start at 40 and climb as high as 55. The project is scheduled to be operational by August 2015.
Infrastructure construction will include a rail spur and upgrading county road 142 to accommodate heavy truck traffic to U.S. 67, about 2 miles to the west.
The road distance between the processing plant and feed mill sites is 33 miles.
When in full operation, the Corning facility is expected to generate 100 trucks daily hauling feed or grain. The daily truck count is expected to increase to 350 during harvest season when stores of corn, milo and wheat are collected from area farms.
“I see it as a local benefit to our local farmers,” said another community leader in Corning. “They’ll have a ready market here.”
In addition to traditional row crop opportunities, the Peco operation is introducing poultry farming to the mix.
“They’re lining up people to build and raise chickens for them,” a Clay County source said.
“We’re talking 600 chicken houses. They’re going to start building them like crazy.”
Helping fund the new Peco facilities will be two industrial revenue bond issues of $128.5 million in Randolph County and $36.5 million in Clay County.
Incentives and grants are ex-pected to be part of the overall package.
Some described the processing plant in terms of the largest facility of its kind in the nation, with a near around-the-clock quality to operations and the synchronicity with the feed mill, hatchery and growers.
“It’s pretty amazing how all this is going to work,” said a Randolph County source.
Peco’s clientele includes Tyson Foods, Buffalo Wild Wings and Church’s Chicken and is supported by a strong dose of private label business and institutional sales with a mix of overseas exports.
Second Project in State
The new Randolph-Clay County operation will mark the company’s second project in Arkansas.
Peco Foods first ventured into the state in 2011 through acquisition in a deal credited with making it the eighth-largest poultry processor in the nation.
The company bought Independence County assets of Townsends Inc. of Georgetown, Del.
The $51 million bankruptcy purchase of Townsends’ Arkansas operations included a processing plant in Batesville and a feed mill in Newark.
In 2012, Peco announced an additional $13.8 million investment to expand the Independence County operations. The resulting 300 new jobs pushed its Batesville area workforce to more than 1,100.
Growth through acquisition also helped fuel Peco’s expansion into Mississippi. During the 1990s, the company made two significant buys in the Magnolia State.
Peco purchased a Sebastopol poultry processing plant and associated assets from Green Acre Farm Inc. for $27.1 million in 1995.
The company followed that up with a $10.5 million deal in 1998 with Marshall Durbin Food Corp. and Marshall Durbin Farms Inc. The transaction involved the Canton processing plant and associated assets.
Mark Hickman, president and chief executive officer of Peco Foods, represents the third generation of leadership at the family-owned enterprise.
The company traces its roots back to 1937 in Gordo, Ala., with John Herman Hickman raising and selling a few dozen chickens. Over the years, his venture developed into a feed mill and hatchery.
In 1968, Peco Foods was created from the merger of the Hickman family’s business and Harris Poultry & Egg Co. The Hickmans bought out the E.S. Harris family’s stake in 1982.