After 30 years in the trade, Supreme Beef Processors Inc. and Supreme Beef Packers Inc. were closing down today (September 29), president and chief executive Steven F. Spiritas said as he blamed the U.S. Department of Agriculture.

Spiritas said Wednesday the company was filing for protection from creditors under Chapter 11 of the U.S. Bankruptcy Code, closing two Dallas-area facilities and laying off 300 workers.

Spiritas accused the USDA's Food Safety Inspection Service (FSIS) of pursuing "a campaign of harassment, intimidation and disinformation against our company after we sought legal protection under the law, as is our Constitutional right, in hopes of saving our company."

FSIS press officer Beth Gaston denied the allegations, adding: "Absolutely not! We have a standard for every plant in the country. We treat all plants the same."

Supreme Beef's shutdown and bankruptcy comes despite winning the initial round of its legal fight challenging the USDA's authority to withdraw meat inspection from a processing operation trying to meet federal food-safety standards.

Spiritas accused the USDA of pursuing "unjustifiable changes in ground-beef purchasing specifications for the School Lunch Program, implemented after the Dallas court decision of May 25th."

The USDA had said it would withdraw its meat inspection at Supreme Beef because ground beef samples from a company plant failed in three consecutive sets of tests to meet or beat a USDA standard for maximum acceptable salmonella contamination. A fourth followup test series also found Supreme Beef's finished product failing to meet health standards, the USDA said.

The standard was spun off a past national industry average for salmonella detected in meats, and it has been used as a benchmark indicator for potential contamination by other pathogens.

Its salmonella-test failures led to Supreme Beef`s recalling ground beef that was suspected of possible contamination with E. coli bacteria last December, Gaston said. Then on Sept. 1, long after the May court decision favoring Supreme Beef, FSIS tests were positive showing Supreme ground beef with likely E. coli contamination, she said.

No recall ensued, apparently because Supreme Beef withheld its suspect product from the market.

While appealing the case, the USDA has continued to maintain its three-strikes-out standard, which has been billed as the legal underpinning of the agency's battle against microscopic pathogens in meats and poultry.

But Spiritas offered another view: "Their risk estimates of meat and poultry have never had anything to do with our company or with ground beef produced in the United States," he said.

"We are very proud of our family-owned business' reputation for providing high-quality and wholesome meat," he said. "We have never had even one case of food-borne illness linked to any of the billions of pounds of beef products we have provided to the public in our 30-year history."

Supreme Beef's problems may have stemmed from its outside suppliers of beef trimmings for grinding, but the USDA said the company was liable for the quality of its end product and had remedies available for correcting the problems leading to the tainted product.

Spiritas, however, said the USDA has even admitted "there is nothing that any ground beef processor can do to remove salmonella that is delivered in meat purchased from other USDA-inspected production facilities. Their unworkable 'performance standard' has simply created a problem for which there are no solutions."

Gaston said Supreme Beef made some changes in its efforts to generate products that would pass the tests, but failed to solve the problems. Of only three plants nationwide that have had products failing to pass three consecutive sets of tests, two are Supreme Beef's Dallas-area operations, she said.

"We have treated Supreme Beef like we have treated any other plant," Gaston said. "We have applied the same salmonella-performance standard. We are obligated to the public to enforce a food-safety standard."

But Spiritas said USDA policy "has not only caused USDA difficulty in filling its purchase requirements, but has compelled the agency, and hence taxpayers, to pay excessive prices for its ground beef contracts."

USDA procurement prices on ground beef have been running higher since the agency's contracts began in June to require higher quality meat for the School Lunch Program and other federal nutrition and feeding programs for elderly citizens and other recipients, agreed Billy Cox, spokesman for the USDA's Agricultural Marketing Service.

Since June, the USDA _ which buys more than 100 million pounds of frozen ground beef a year _ has been paying typically about 25 cents to 60 cents a pound more, depending on specifications, and sometimes up to about 80 cents more per pound than a year earlier, according to USDA reports on the Internet.

Cox said the contracting level is running at about 75 percent or more of the volume preferred by this time of the school year, and the price is averaging about $1.50 a pound.

"The price has gone up. That`s the price we're having to pay for safety," Cox said. "We are now buying a new product ... a safer product."

He said the USDA wants and expects prices to come down as suppliers learn the new contract demands and competing bidders increase in number.

Gaston said the USDA remains uncertain how Supreme Beef's bankruptcy and shutdown will affect the agency's appeal of the litigation.

Spiritas said the USDA continues to use "misleading estimates of salmonella-caused, food-borne illness. The government lumps contamination levels of all poultry products together with beef to create an erroneous suggestion of risk to the consumer from beef products. USDA does not address separately the incidence levels of salmonella in beef, and specifically in ground beef, when it comes to public health statistics."

Gaston said every federally-inspected meat and poultry processor, packer and slaughter operation must meet the same standards.

By WORTH WREN JR.
StoreAlliance.com Staff Writer