Agriprocessors could resume production today, Wednesday

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POSTVILLE -- Agriprocessors was expected to resume poultry operations today or Wednesday, the company's trustee said.

Emergency financing was approved by a bankruptcy court on Monday, which should allow workers to resume production immediately, said Joseph Sarachek, Agriprocessors' court-appointed trustee.

"This is a new day for this company," he said.

A bankruptcy judge in New York's Eastern District awarded the company $2.5 million in advances from First Bank Business Capital of St. Louis to finance plant operations through Dec. 12.

The largest chunk of money will go to feed and process 750,000 hens and chickens.

Employees who return to work will eventually receive pay owed to them, though that may take weeks, he said. The judge approved $167,588 toward back pay of employees.

The company halted operation more than three weeks ago. At its peak, the kosher meatpacking plant employed more than 900 people in beef and poultry processing. Before it closed, about 200 people worked only in poultry operations.

The company's plant in Postville was raided by federal immigration agents May 12.

Fresh produce and livestock producers will also receive payments owed to them, Sarachek said, though the assets are still frozen in bankruptcy.

He said more than $3 million in claims have been filed against a bond and trust held by the company. The bond and trust contain sufficient funds to make those payments, he said.

U.S. Sen. Tom Harkin, D-Iowa, chairman of the Senate Agriculture Committee, issued a statement Monday pressuring the USDA to intervene on behalf of livestock producers unpaid by Agriprocessors.

He said producers are protected under federal law, but "that only applies when the law is enforced."

Court documents show the USDA has been investigating Agriprocessors for weeks.

But the USDA cannot force payments when a company's assets are tied up in bankruptcy court, said Jay Johnson, regional director of USDA's Grain Inspection Packers and Stockyards Administration in Des Moines.

Contact Jens Manuel Krogstad at (319) 291-1580 or jens.krogstad@wcfcourier.com.

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