Smithfield Foods CEO Larry Pope has moved to try and reassure US lawmakers the sale of the meat giant to China’s Shuanghui International will not affect US exports and food security.
The US company accepted a US$7.1bn takeover bid from Shuanghui, China’s biggest pork producer, in May. The takeover would give Shuanghui control of the world’s largest pork supplier and has reportedly raised concerns that the deal may mean a transfer of jobs to China or a reduction in food safety.
Speaking before the Senate Agriculture Committee in Washington yesterday (10 July), Pope said he expects the transaction to drive growth and expansion not only for US growers, but for the entire US pork industry.
“Smithfield Foods owns over 400 hog farms and has contracts with more than 2,000 family farmers across the country. Our agreement with Shuanghui will maintain all of these contracts and arrangements,” he told the committee. “Moreover, this transaction creates a terrific opportunity through growth in exports for US hog farmers to expand production to meet the growing Chinese demand.”
Pope also moved to emphasise Shuanghui’s commitment to maintaining Smithfield’s operations, staff and management.
“Shuanghui intends to retain Smithfield’s management team, its plants and its employees. Shuanghui recognises Smithfield’s best-in-class operations, outstanding food safety practices and 46,000 hard-working employees. There should be no noticeable impact on how we do business operationally in America and around the world as a result of this transaction, except that we will do more of it.”
The Committee on Foreign Investment in the US (CFIUS) is looking into the deal, although the transaction is expected to be cleared.
According to Bloomberg, a bi-partisan group of senators, including Senate Agriculture Committee Chairwoman Debbie Stabenow, is urging the Committee on Foreign Investment in the US (CFIUS) to include the US Department of Agriculture and the Food and Drug Administration in its review to ensure experts on food supply and food safety are part of the process.
Pope suggested at the hearing that he had no issues about a USDA review.
“Our combined company has every incentive to ensure the continued safety and excellence of our products and brands. Smithfield’s facilities will continue to maintain their quality and will experience the same rigorous level of USDA FSIS inspection, regardless of the ownership of this company. Absolutely nothing about how our products are made, inspected or distributed will change.”