Smithfield Purchase Stirs Discussion At World Pork Expo

Iowa Farm Scene

U.S. pork producers cite opportunity to export more pork to China, but concerns remain.

Published on: June 10, 2013

With 862,000 sows to produce 20 million to 22 million market hogs annually, Smithfield is the top American pork producer. But Smithfield is a "drop in the bucket compared to hog numbers, pork production and pork consumption in China," says Meyer. "China in 2012 had 49.28 million sows and they slaughtered 694 million hogs. Smithfield's U.S. numbers would account for 1.7% of the Chinese sow herd and 3% of China's 2012 slaughter."

Iowa economic development officials welcomed Chinese visitors to Pork Expo

Iowa Gov. Terry Branstad, Lt. Gov. Kim Reynolds and Iowa Sister States officials, along with Iowa Secretary of Agriculture Bill Northey, welcomed the visiting Chinese delegation at a luncheon held at the World Pork Expo. One of the visitors was Wang Cheng who came to Iowa wanting to buy 1,000 breeding hogs. The farm manager from Hebei province said he likes Iowa hogs because of their disease resistance and ability to wean big litters. And he needs to double the size of his breeding herd to help fulfill demand for protein by Chinese consumers.

His purchase would be tiny compared with the Chinese company's planned $4.7 billion buyout of Smithfield Foods. But the Chinese want our hogs and they want our expertise in raising livestock and producing pork. "Their interest benefits Iowa and our pork industry," Gov. Branstad and others say. However, critics point out several concerns, one of them is food security. Do we want China to basically gain partial or full control of part of our food supply at some point?

Some critics of the Smithfield deal have even raised the possibility of Chinese buying Iowa farmland. But Branstad emphasized that Iowa law would prevent foreign ownership of farmland.

China and Iowa share the common goal of increasing food production

China's agriculture, still dominated by small farms, is under pressure. As the world's most populous nation it needs to improve its productivity to prevent food shortages. As its population grows wealthier, China is eating more protein. But lack of arable land, lack of rainfall and other environmental constraints will restrict food productivity gains. The grand strategy behind these types of acquisitions is feeding their people so the people don't revolt, so the Communist Party can stay in power.