Premium Standard Farms announced that it would expand capacity at the company’s Milan, Mo., pork processing plant.

The improvements will increase processing levels to 10,000 head per day versus the current level of 7,400 head per day. This translates into 15 percent of additional total company processing capacity, or an additional 35 percent capacity to the Milan plant. The increased capacity project will begin in the second quarter of 2007.

"The decision to expand our Milan plant is a critical component to our growth strategy,” says John Meyer, chief executive officer of PSF. “This investment will allow us to meet increasing international and domestic demand for our products as we continue to further enhance our export business and expand our domestic customer base."

The company will acquire the additional hogs necessary to expand the processing levels at the Milan plant from three sources:

* PSF's Missouri farms, which have experienced increased productivity from the existing sow base.

* Outside producers that would become part of PSF's Processed Verified Program. This is based on a successful model that was instituted at the company's North Carolina plant, which currently obtains approximately 25 percent of its head from other Processed Verified suppliers.

* The potential also exists for additional hogs to come from PSF's Texas operations.

"Increasing the processing capacity at the Milan plant illustrates one initiative in our plans to grow PSF both organically and through acquisitions,” says Meyers. “In addition, the expansion will help us to achieve our strategic goal of moving more of our business mix into the processing segment."

Source: PSF news release