Organizations Urge Rejection of Smithfield Takeover
A coalition of farm, rural and consumer organizations delivered a letter to the members of the Committee on Foreign Investment in the United States urging them to recommend that the Obama administration reject the proposed Shuanghui International Holdings Ltd. acquisition of Smithfield Foods.
It arrived on the eve of a Senate Agriculture Committee hearing on the deal (see http://web-post.community.foodprocessing.com/content/smithfield-ham-capital-grill).
The letter was signed by officers of Campaign for Contract Agriculture Reform, Coalition for a Prosperous America, Center for Rural Affairs, Contract Poultry Growers Assn. of the Virginias, Food & Water Watch, Iowa Citizens for Community Improvement, Land Stewardship Project, Missouri’s Best Beef Co-Operative, Missouri Farmers Union, Missouri Rural Crisis Center, National Family Farm Coalition, National Farmers Union, Nebraska Farmers Union, Organization for Competitive Markets, Rural Advancement Foundation International-USA, R-CALF USA and Western Organization of Resource Councils.
The letter called out what it called "significant risks of a Shuanghui takeover of Smithfield to food security, consumer food prices, food safety, farm and rural economies in the United States and national security."
“The White House should reject the sale of America’s food supply,” said Tim Gibbons with the Missouri Rural Crisis Center. “This proposed acquisition is a prime example of how expanded corporate consolidation in agriculture has gone too far, resulting in lack of markets for independent producers, and damaging effects on our rural economies and country. The Smithfield purchase turns over American farms to a consolidated, globalized meatpacking industry that leaves rural communities to clean up the waste while China gets the meat.”
Shuanghui’s purchase of Smithfield would transfer ownership of a company that controls more than a quarter of American pork production and buys or contracts a quarter of U.S. hogs, the groups claim. The proposed deal is expected to shift Smithfield pork production toward exports to feed the Chinese market, which would likely significantly increase retail pork prices for American consumers. It would make many U.S. hog producers dependent on a foreign firm for hog contracts and prices.
The letter also demonstrates the risks the takeover could pose to U.S. food safety. First, the Chinese firm operates in one of the most notoriously lax food safety systems in the world, and the management culture clashes between Shuanghui and Smithfield could weaken the safety at Smithfield’s U.S. plants. Second, Shuanghui would eventually want to export pork products to the United States, which would expose U.S. consumers to the host of food safety scandals that plague the Chinese food system.
“As recently as 2011, Shuanghui managers were sentenced to prison for allowing illegal veterinary drugs into the pork supply in China and we don’t want to expose American consumers to such indifferent food safety standards,” said Food & Water Watch executive director Wenonah Hauter. “If Shuanghui eventually exported bacon, sausage or ham to the United States under the well-known Smithfield brands like Armour or Gwaltney, American consumers would not even know, because processed pork is exempt from country of origin labeling.”
The letter was delivered to the Cabinet Secretaries that make up the Committee on Foreign Investment in the United States. The letter can be viewed here: http://fwwat.ch/15rV366.