"Pink slime" label forces US beef plant closures

A beef company that makes the ammonia-treated beef that critics called pink slime said on Monday it will close three of its four plants after sales dropped and did not recover following recent attacks on the product.

Beef Products Inc will close plants on May 25 in Amarillo, Texas; Garden City, Kansas; and Waterloo, Iowa. Its South Sioux City, Nebraska, plant will continue to operate at a reduced capacity.

More than 650 people will lose their jobs when the plants close, the company said.

"While we had hoped to be able to resume operation at those plants, that is not going to be possible in the immediate future and the temporary suspension of operations will in fact result in the elimination of those jobs effective May 25, 2012," the company said in a statement.

In late March, the South Dakota-based BPI had suspended production at the three plants for 60 days. At that time, BPI spokesman Rich Jochum had said the closure could become permanent.

"This is a direct reaction to all the misinformation about our lean beef," Jochum said then.

Iowa Governor Terry Branstad on Monday called the closings a"sad day for the state of Iowa."

"The fact that a false, misleading smear campaign can destroy a company's reputation overnight should disturb us all," Branstad said in a statement.

The company's lean finely textured beef is used in ground beef. The criticism and subsequent drop in sales came despite US Agriculture Department and industry experts saying the beef was safe to eat.

Two of the biggest US supermarket operators, Safeway Inc and Supervalu Inc had said they would stop buying the ammonia-treated beef.