EUGENE, Ore. — An Oregon beef processor has shut down while owing $4.6 million to cattle suppliers, but the company says in court filings that it expects its assets are worth more than its debts.
A court-appointed receiver will oversee the dissolution of Bartels Packing, which in mid-March closed its slaughterhouse and processing facilities near Eugene, Ore.
Apart from the immediate financial impacts to suppliers, the demise of Bartels Packing also signifies the loss of a major cattle buyer in Oregon’s livestock industry.
“We look for competition in the marketplace, so there’s one less competitor in the marketplace now,” said Bruce Anderson, owner of the Eugene Livestock Auction.
Representatives of Bartels Packing would regularly attend Oregon several livestock auctions, where they’d primarily bid on culled dairy cattle and other “butcher cows” that would be processed into hamburger, Anderson said.
Bartels Packing was among the three largest bidders for cattle at the Woodburn Livestock Exchange, said Tom Elder, the auction yard’s owner. The other two companies, Walt’s Wholesale Meats and Schenk Packing, operate out of Washington state.
Specifically, Bartels Packing had a demand for organic dairy cows, which provide much-needed supplementary income for dairy farmers, he said.
“There’s already plenty of cows to keep these packers busy,” Elder said.
Less competition for cattle typically means lower prices.
When Bartels occasionally didn’t attend the auction, prices were about 10 percent lower for cattle the company would normally bid on, he said.
However, broader fluctuations in the beef market may compensate for the closure of Bartels Packing, and another competitor may eventually fill its niche, Elder said.
“There’s definitely an opportunity there for someone,” he said.
Oregon already has limited beef processing facilities, so the absence of Bartels Packing will be felt in the industry, said Jerome Rosa, executive director of the Oregon Cattlemen’s Association.
“It’s definitely going to have an impact on beef prices here in the Northwest,” Rosa said. “This is a real sad situation to lose a packer of that size in Oregon.”
With the demand for U.S. beef in China, though, another business could potentially buy Bartels’ equipment and replace the lost slaughter and processing facilities, either at the same location or a different one, Rosa said.
The company’s owner, Chris Bartels, did not respond to a request for comment.
In court documents seeking to dissolve the company, Bartels requested that a receiver oversee the liquidation of assets to maximize their value.
The company’s assets are worth between $13.5 million and $14 million, including $8 million in inventory, $300,000 in accounts receivable and more than $5.5 million in fixed assets, such as equipment, according to court filings.
The court filings estimated the company owes 25 or more creditors about $8.3 million, including the $4.6 million owed to cattle suppliers and feedlots.
Because there is “not a readily available market” to quickly sell “a few million pounds of various cuts and grinds of beef,” it makes more sense for this perishable inventory to be liquidated by a specialized receiver, rather than individual creditors, the filings said.
For the same reason, the equipment is likely to fetch the highest value “as part of a functioning meat harvest or packing facility or alternately as a lot, as opposed to selling equipment in a piecemeal fashion,” the filings said.
As long as the liquidation is “handled in an orderly manner,” there should be more than enough assets to “settle the debts of all creditors,” according to a court filing.