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WASHINGTON - The Justice Department has said it will permit the sale of now-bankrupt Farmland Industries Inc.'s pork business, despite arguments that the sale could lead to a monopoly of the pork industry, The Associated Press reports.
Smithfield Foods Inc. wants to buy the company's Farmland Foods division for $363.5 million. One of its competitors, Cargill Inc., recently offered to buy it for $385 million.
Senate Finance Committee Chairman Charles Grassley, R-Iowa, and Sen. Tim Johnson, D-S.D., asked antitrust regulators at the Justice Department to look into the sale of Farmland to Smithfield.
"It's disheartening that the Justice Department won't intervene in the bankruptcy court's sale of Farmland Foods," Grassley told reporters Wednesday. "The continued trend in agriculture concentration works against the family farmer, and today's news is very bad for Iowa's independent pork producers."
The U.S. Bankruptcy Court will oversee an auction later this month to determine whether Cargill or Smithfield can buy Farmland.
Farmland Industries was once the nation's largest farmer-owned cooperative. It filed for bankruptcy in May 2002. The company has been selling its assets and using the proceeds to pay off debt. The pork processing business is its largest remaining asset.
Smithfield Foods, based in Virginia, is the largest producer of hogs. Cargill Inc., based in Minnetonka, Minn., owns Excel Corp., another leading meat processor.