PepsiCo’s Quaker Oats plant in Illinois to close, laying off 510 employees

PepsiCo is permanently closing a Quaker Oats plant that was temporarily shuttered recently after products it made were recalled due to Salmonella contamination. An Illinois WARN notice showed 510 employees would be laid off.

The Danville, Illinois, plant, which has been operating for 55 years, will close June 8, according to a Facebook post from the city. Food Safety News said the facility manufactured more than 60 products recalled in December 2023 and January 2024.

In a statement, Quaker said it determined “that meeting our future manufacturing needs would require an extended closure for enhancements and modernization.” Production is shifting to other facilities. Quaker has baking plants in Cedar Rapids, Iowa, and Columbia, Missouri, as well as one in Ontario, Baking Business reported.

PepsiCo said operating profit in Quaker Oats North America in 2023 declined 19% to $492 million due to the recall, operating cost increases and higher commodity costs, among other expenses. These impacts were offset by higher pricing and productivity savings.

Food manufacturers have been closing some facilities and opening or expanding existing plants to right-size production and improve efficiencies across their manufacturing networks. In most cases, closing locations would be too expensive to retrofit with new equipment or to make them more environmentally friendly.

Earlier this week, Conagra Brands announced it would close a facility in Beaver Dam, Wisconsin, that produces its Birds Eye frozen brand. The decision came as part of a broader review to ensure it’s “operating as effectively and efficiently as possible.” Conagra said 252 people would lose their jobs.