CORPORATE FARMING NOTES

All of us owe a debt of gratitude to our friends at Successful Farming. Every year their Pork Powerhouses® issue reports on the 20 largest U.S. pork producers.

Smithfield, having fully digested Premium Standard Farms, reigns supreme in vertically integrated pork production with 1,227,000 sows. Long ago people referred to Chicago as the “hog butcher to the world.” With over one million sows in the U.S., 96,000 in Mexico, 76,000 in Poland, and 51,000 in Romania, that title belongs to Smithfield.

Most of the 20 largest producers have increased their sow herd this year. Smithfield added 27,000 sows, a marginal increase. Cargill added 20,000 sows in newly constructed facilities. AMVC of Audubon, Iowa added 20,000 sows in new facilities in North Dakota. Maxwell Foods of Goldsboro, North Carolina added 9,000 sows, mostly in Indiana.

Senators Grassley (R-IA), Dorgan (D-ND), Enzi (R-WY) and Harkin (D-IA) have reintroduced legislation to prohibit packers from owning livestock with hope of including it in the 2007 farm bill. Clearly, as you read Successful Farming’s list and wonder where Smithfield’s next merger lies, it is now or never for Congress to ban packer ownership of livestock.

Last month we reported on $25 million in federal grants provided by the Environmental Protection Agency (EPA) to America’s Clean Water Foundation (ACWF) for assisting large hog facilities with environmental compliance. An audit by EPA’s Inspector General found severe irregularities and recommended that ACWF be forced to repay almost $25.2 million out of $25.4 million granted.

Over the last month EPA has informed us that they complied with their Inspector General’s recommendation and notified ACWF that the money must be repaid. They did so knowing that the foundation dissolved in 2006 and has no assets. They have not examined the close ties between the National Pork Producers Council, Validus Services (an NPPC for-profit subsidiary) and ACWF, nor considered any responsibility those entities might have for repayment.

Over $25 million in taxpayer dollars were squandered and mismanaged, or worse. However, EPA appears to have no intention to pursue the matter and has referred the case to the Treasury Department for consideration of further action. Our calls to Treasury and too many questions have gone unanswered, so far. But we’ll keep calling and we’ll keep asking.

Contact: John Crabtree, johnc@cfra.org or 402.687.2103 x 1010 with questions and comments about Corporate Farming Notes.

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