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Iowa lawmakers concerned over merger of largest hog producersDES MOINES, Iowa (AP)--Iowa lawmakers are expressing concern over a pork industry giant's plans to buy another leading hog producer and processor. Smithfield Foods Inc., the nation's largest pork producer and processor, plans to buy Premium Standard Farms Inc., the country's No. 2 hog producer and No. 6 pork processor. The move has prompted Sen. Charles Grassley, R-IA, and Sen. Tom Harkin, D-IA, to ask the U.S. Department of Justice to take a closer look at the proposed merger. In a letter Sept. 19 to the department's antitrust division, Grassley said the merger would hurt independent farmers by reducing the number of places they can sell their hogs. "I have strong reservations about this proposal and the continued trend in concentration in the pork industry and, as such, I urge the Department of Justice to carefully scrutinize this transaction," Grassley wrote. National Farmers Union President Tom Buis said the deal "all but guarantees independent producers will be left without a market." The Justice Department could block the merger on antitrust grounds, or it could require the companies to sell off some of their operations. Dennis Treacy, Smithfield vice president of environmental, community and government affairs, acknowledged in an interview with The Des Moines Register that the $810 million purchase represents more consolidation in the pork industry. But, he has said the company is confident that the Justice Department will clear the merger. Smithfield Foods, which has no operations in Iowa, owns Farmland Foods and John Morrell. Both of those companies have Iowa slaughtering plants. Premium Standard Farms has pork plants in Missouri, Texas and North Carolina with an annual capacity of slaughtering 4.6 million hogs. The deal is expected to close in the first quarter of 2007. Date: 10/11/06
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