Chi­nese-owned pork pro­ducer to get bailout money

The Mercury News Weekend - - NEWS - By Jeff Stein The Wash­ing­ton Post

WASH­ING­TON » A Chi­nese- owned pork pro­ducer will sell at least $240,000 worth of ham prod­ucts to the fed­eral govern­ment as part of the Trump ad­min­is­tra­tion’s farm bailout pro­gram, the ad­min­is­tra­tion said Wed­nes­day.

U.S. pork pro­ducer Smith­field, which is owned by the Chi­nese con­glom­er­ate WH Group, will sell 144,000 pounds of ham prod­ucts to the fed­eral govern­ment un­der the con­tract.

The Agri­cul­ture Depart­ment is pur­chas­ing pork and other com­modi­ties from U. S. farm­ers to help off­set the dam­age from re­tal­ia­tory tar­iffs im­posed by China this sum­mer. The ad­min­is­tra­tion has pitched the re­lief as a nec­es­sary short-term mea­sure to help farm­ers weather the trade bat­tle.

The Agri­cul­ture Depart­ment an­nounced about $7.5 mil­lion worth of awards un­der the pur­chase pro­gram Wed­nes­day, ac­cord­ing to a no­tice re­leased by the depart­ment’s Agri­cul­tural Mar­ket­ing Ser­vice, which is ad­min­is­ter­ing the pur­chase pro­gram. Smith­field could re­ceive more tax­payer money in sub­se­quent rounds of the pur­chas­ing pro­gram.

The agency said in Au­gust that it would buy $1.2 bil­lion of prod­ucts from farm­ers, in­clud­ing more than $ 500 mil­lion from pork pro­duc­ers, but the ex­act tim­ing of those pur­chases has not been re­leased. The Trump ad­min­is­tra­tion has au­tho­rized $12 bil­lion in over­all spend­ing for the bailout pro­gram, in­clud­ing di­rect cash pay­ments to farm­ers, par­tic­u­larly soy­bean pro­duc­ers.

The Agri­cul­ture Depart­ment said last month that Smith­field qual­i­fied for the bailout money, not­ing that the agency would be pur­chas­ing only goods pro­duced in the United States. Sen. Charles Grass­ley, RIowa, a farmer and mem­ber of the Se­nate Agri­cul­ture Com­mit­tee, has ex­pressed alarm that a Chi­nese-owned firm could ben­e­fit from bailout money in­tended to help Amer­i­can farm­ers sur­vive a trade war with China.

The awards were made pub­lic the day af­ter the midterm elec­tions, tim­ing that some watch­dog groups said was no co­in­ci­dence.

“It is highly sus­pi­cious that this an­nounce­ment came a day af­ter the midterm elec­tions,” said Tony Corbo, se­nior lob­by­ist at Food and Wa­ter Watch, which tracks fed­eral agri­cul­ture pro­grams. “Congress needs to ex­er­cise over­sight of this pro­gram. This is an ex­am­ple of cor­po­rate wel­fare at its worst.”

The USDA mar­ket­ing ser­vice said in a state­ment last month that the prod­ucts it will buy are “100 (per­cent) Amer­i­can pro­duced.” In a sep­a­rate state­ment, the USDA’s cen­tral com­mu­ni­ca­tions of­fice said the agency could not con­trol whether fed­eral money given to U.S. sub­sidiaries would en­rich their Chi­nese own­ers.

“USDA does not have the abil­ity to po­lice whether money will even­tu­ally ‘ fil­ter to the Chi­nese,’ “a USDA spokesman said. “The Depart­ment goes to great lengths to en­sure we have reg­is­tered, ap­proved U. S. ven­dors that work closely with the Agri­cul­tural Mar­ket­ing Ser­vice.”

Smith­field has said it meets the fed­eral govern­ment’s cri­te­ria for the pro­gram. Keira Lom­bardo, se­nior vice pres­i­dent of cor­po­rate af­fairs at Smith­field, said in an email last month that the com­pany meets the USDA’s el­i­gi­bil­ity stan­dards and that “any ap­proved ven­dor that can sup­ply the re­quested prod­uct can bid for the con­tract.”

Lom­bardo also said that Smith­field is a U. S.-based com­pany em­ploy­ing thou­sands of Amer­i­cans and that its U.S. meat prod­ucts are made in its nearly 50 do­mes­tic fa­cil­i­ties.

Smaller hog pro­duc­ers have ex­pressed anger over the pos­si­bil­ity of money flow­ing to for­eign- owned busi­nesses, not­ing that the bailout has been billed as a sup­port for do­mes­tic firms. But the in­ter­na­tional reach of com­pa­nies makes it hard to en­sure that fed­eral dol­lars stay in U. S. hands, re­gard­less of their in­tended tar­get.

The White House cre­ated the bailout pro­gram uni­lat­er­ally, with­out con­gres­sional ap­proval, un­der a rarely used farm pro­gram from the Great De­pres­sion. Two se­na­tors — Grass­ley and Sen. Jon Tester, D-Mont., who nar­rowly won re- elec­tion Tues­day — have said they will be ap­ply­ing for di­rect help from the fed­eral govern­ment.

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