Header graphic for print

Food Safety News

Breaking news for everyone's consumption

Second Auction May Fetch Millions More For NM Organic Peanut Processing Plant

The Portales, NM, processing plant that was at one time the largest producer of organic peanut butter in the U.S. was auctioned off last Thursday to Severn, NC-based Hampton Farms for $20.05 million. However, the Sunland Inc. plant will be auctioned off again today for at least $25 million, an amount offered to the U.S. Bankruptcy Court for New Mexico from Canada’s Golden Boy Foods.

The unusual turn of events occurred just before the bankruptcy court entered a final sale order on last Thursday’s offer when Golden Boy Foods wired a counteroffer of $25 million to a trust account. That becomes the new opening bid for today’s auction. In addition to Hampton, California’s Ready Roast Nut Company LLC had bid in last week’s auction .

It’s left Bankruptcy Judge David T. Thuma with a tough decision to make. He said he was “loath to disturb the results of a judicial auction,” but, on behalf of the unsecured creditors of Sunland Inc., he did not want to lose the additional $4.95 million that Golden Boy Foods brought to the bankruptcy proceedings.

Sunland filed for Chapter 7 bankruptcy last October after peanut and nut butters it manufactured at the Portales plant in 2012 were found responsible for a 20-state outbreak of Salmonella. The U.S. Food and Drug Administration (FDA) suspended Sunland’s food plant registration for several weeks under the first use of a new government power found in the Food Safety Modernization Act.

Hampton Farms, the nation’s largest peanut roaster, has said that it plans to re-open the Portales plant. Golden Boy makes peanut and nut butters from several locations in Canada, but has not said how it would use the Portales plant.

Sunland once purchased much of the Valencia peanut crop grown along the Texas-New Mexico border for add-value processing. Many peanut growers in the area are waiting for the court’s decision on the sale as part of their decision on whether to plant a Valencia crop for the coming season. Soil temperatures are expected to be warm enough to plant peanuts in April.

© Food Safety News