Heralded as a “new start” and an opportunity for growers, Pure Prairie Poultry that acquired and refurbished a plant in Charles City, IA. filed for Chapter 11 bankruptcy on September 20th.
The plant has a checkered history. Originally established as a hen-processing facility it operated as Cedar River but the enterprise failed. The plant was resuscitated as Simply Essentials in 2016 backed by venture capital funding although this iteration failed and the plant fell into disuse. Pure Prairie purchased the facility in December 2021 but failed to achieve profitability having accumulated close to $40,000 in operating losses since production commenced in November 2022.
The company qualified for and received a $39 million federal loan in April 2022 that in retrospect was essentially pouring public money into the effluent stream. But then USDA is intent on restructuring the protein supply system in the U.S. In their filing, Pure Prairie listed $100 million in assets and up to a nominal $500 million in liabilities.
It will be some time before court documents are available to indicate the causes of the demise of the company. From promotional press reports at the initiation of production, the Company should have been able to establish a market niche and prosper for the benefit of stakeholders, ultimately repaying the federal loan and other investors.