BioKyowa to lay off 45 workers

Nash Road industry BioKyowa Inc. will discontinue production of farm-grade amino acid lysine and food-grade nucleic acids by March, resulting in the loss of 45 employees.

Kyowa Hakko Kogyo, the Japan-based parent company of BioKyowa, is taking a $100 million loss primarily due to two expansions in the past two years: one to increase production of lysine and the other to begin production of food supplements for human consumption.

Kohta Fujiwara, president of BioKyowa Inc. and Kyowa Inc., the division that makes food supplements, blamed a sagging Asian economy and oversupply of products.

Two years ago, lysine cost about $1.20 a pound. Today, prices have dropped to 70 cents a pound. Over the past two years, prices of food supplements have dropped more than 50 percent.

But Kyowa Hakko Kogyo will restructure the Cape Girardeau operation. It plans to invest about $10 million in modifying the plant and will maintain about 165 workers, more than double the number at the plant when it opened in 1983.

BioKyowa was recognized this month as the fourth two-time winner of the Commitment to Excellence Award of the Cape Girardeau Chamber of Commerce.

"Unhappily, it is necessary to streamline the work force," Fujiwara said. "This difficult and painful decision is an essential part of the restructuring to enable us to achieve a cost-effective operation for the future."

He said there will be financial packages for those laid off.

After the restructuring, the local plant will produce industrial grade amino acids for export to Japan and will continue to make feed-grade tryptophan and threonine.

BioKyowa employees were told of the restructuring Thursday morning.

"It was shock," said Todd Blattel of Gordonville, Mo., who has worked at the plant for nine years.

It could have been worse, said employee Dalton Mathis of Cobden, Ill. The company could have closed the plant, he said.

"It's a pity," said Mathis, who has worked at the plant since it opened. "We've had slowdowns, but we've never had a layoff here."

In addition to the 45 who will lose their jobs, another 20 to 30 workers will be laid off for a short while when the food-grade production ends in June or July, said Bill Hinkley, plant manager.

"These workers will be rehired within two months following conversion of the plant for the production of industrial chemical products," Hinkley said.

Many workers will have to be retrained for the manufacture of the new products.

BioKyowa has been growing the past three years. The company was the first major Japanese manufacturer to locate in Missouri when it opened its swine and poultry supplement plant here, a $25 million facility with 60 workers. Following $35 million and $50 million expansions over the past two years, employment rose to 210.

rowen@semissourian.com

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