Smithfield Acquisition

Smithfield Acquisition. I’m Greg Martin with today’s Line On Agriculture.

If you’re a fan of bacon, ham, hotdogs or pork chops, then you’re probably a Smithfield Foods customer. The 87-year old Virginia pork producer may soon be taken over by China’s largest meat producer, Shuanghui International, if U.S. regulators allow the deal.

ANDERSON: It’s big because Smithfield is by far the largest single pork producer in the United States and to see our largest pork producer purchased by any outside entity is kind of a big deal. It’s a big deal any time a company that large trades hands.

And American Farm Bureau economist John Anderson says this is a big deal…a $4.7 billion deal, which would make it the largest US acquisition by a Chinese company ever. But it would not be the first time a foreign company has bought a major U.S. meat producer. Brazilian company JBS bought Swift and Pilgrim’s Pride a few years ago.

ANDERSON:I think this is probably a bigger deal than that in that it involves China, which everybody perceives as a real up-and-comer in the world economy and I think that heightens the interest.

And what does all this mean for U.S. consumers?

ANDERSON: You know, I don’t think there will be a lot of changes from the U.S. consumer’s point of view. Expectations at this point are that nothing will change. The management team is left in place. They’re going to operate according to U.S. standards, U.S. guidelines. I don’t think at this point anybody foresees any changes in how Smithfield operates in terms of their hog production operations, in terms of their processing operations, certainly in terms of the standards that they will be held to.

That’s today’s Line On Agriculture. I’m Greg Martin on the Ag Information Network.