In yet another case of an independent news organization proving its worth, Christopher Wallperson at the Midwest Center for Investigative Reporting reports in JBS a big winner in USDA trade war relief contracts:
A Brazilian-owned meat processing company undercut its competition by more than $1 per pound to win nearly $78 million in pork contracts through a federal program launched to help American farmers offset the impact from an ongoing trade war.
As a result, JBS USA has won more than 26 percent of the $300 million the USDA has allocated to pork so far – more than any other company, according to an analysis of bid awards by the Midwest Center for Investigative Reporting .
The USDA’s Trade Mitigation Program was announced last August, and included direct payments to farmers, as well as $1.2 billion in food purchases from farmers and ranchers whose crops normally benefit from international markets. The plan called for $558 million worth of pork purchases. The program is intended to help U.S. farmers and ranchers hurt by the ongoing trade disputes with China, Mexico, Canada and other trading partners.
JBS bid an average of $2.56 per pound for five pound pork loin cuts, while its competitors bid an average of $3.80 per pound. The company bid as low as $2.02 for the cut, the Midwest Center found.
The analysis found that JBS bid 33 percent less on the contracts - undercutting its competitors, even Tyson Foods, the second largest meat processor in the country.
JBS USA is the U.S. division of JBS SA, the world’s largest meat producer. The company owns more than 300 live hog operations in the United States.
It’s expanded its reach in the U.S. in the last decade, buying Swift & Co., Smithfield BeefGroup, Inc., Pilgrim’s Pride poultry and Cargill’s Pork business, in addition to other acquisitions abroad.
JBS’ facilities in Minnesota, Iowa, Illinois and California have won trade mitigation contracts with the USDA.
“Who’s the government going to purchase it from? The Brazilian-owned JBS or the Chinese-owned Smithfield? They’ve allowed enough concentration in the packing industry, you’re running out of choices,” said Brian Duncan, a hog farmer from Northwest Illinois and vice president of the Illinois Farm Bureau.
On the eve of Independence Day, the international corporate agribusiness's dominance reminds Bluestem Prairie of the struggle between business power and liberty. But perhaps it's stretch to draw an analogy between government "supporting one business's interests at the expense of the liberty" of individual farmers and the East India Company.
Bluestem's paternal family legend told the story of how her distant colonial ancestor appropriated indigenous wardrobe and partied in Boston Harbor prior to the American Revolution, but the Houghton fellow who engaged in that performative transgression appears to have been a cousin to her late family members in the colony of Massachusetts. Close enough, we're guessing the family storytellers decided in the 19th Century.
Meanwhile, it's not just the Brazilian-based JBS cleaning up from the top in Trump's trade wars. Associated Press journalist Steve Karnowski reports in Big farms find easy ways around trade aid limits:
When President Donald Trump’s administration announced a $12 billion aid package for farmers struggling under the financial strain of his trade dispute with China, the payments were capped. But many large farming operations had no trouble finding legal ways around them, records provided to The Associated Press under the Freedom of Information Act show.
The government paid nearly $2.8 million to a Missouri soybean operation registered as three entities at the same address. More than $900,000 went to five other farm businesses, in Indiana, Illinois, Tennessee and two in Texas. Three other farming operations collected more than $800,000, and 16 others collected more than $700,000.
Recipients defended the payouts, saying they didn’t cover their losses from the trade war and they were legally entitled to them. Department of Agriculture rules let farms file claims for multiple family members or other partners who meet the department’s definition of being “actively engaged in farming.”
But U.S. Sen. Charles Grassley, an Iowa Republican who has long fought for subsidy limits, and other critics say it’s the latest example of how loopholes let large farms collect far more than the supposed caps allow.
Grassley said in a statement to AP that some of the nation’s largest farms are receiving huge subsidies “through underhanded legal tricks. They’re getting richer off the backs of taxpayers while young and beginning farmers are priced out of the profession. This needs to end. The Department of Agriculture needs to re-evaluate its rules for awarding federal funds and conduct more thorough oversight of where it’s funneling taxpayer dollars.”
USDA officials said they believe its rules are being followed and that procedures are in place to audit recipients.
About 83 percent of the aid under the Market Facilitation Program has gone to soybean farmers because they’ve suffered most under China’s retaliatory tariffs. The program sets a $125,000 cap in each of three categories of commodities: one for soybeans and other row crops, one for pork and dairy, and one for cherries and almonds. But each qualified family member or business partner gets their own $125,000 cap for each category. Farmers who produce both soybeans and hogs, for example, would have separate caps for each and could thus collect $250,000.
But there are legal ways around those caps.
USDA data show the biggest beneficiary has been DeLine Farms Partnership and two similarly named partnerships registered at the same address in Charleston, Mo., that collected nearly $2.8 million. They’re led by Donald DeLine and his wife, Lisa DeLine. Their attorney, Robert Serio, said the partnerships qualified legally and probably could have qualified for more if not for the caps. He said each partnership farms around 27,000 acres and is made up of eight or nine partners who all meet the “actively engaged” requirement. . . .
Read the rest at Big farms find easy ways around trade aid limits.
We're just guessing that Jefferson didn't have this in mind when he lavished praise on yeoman farmers, or so the late historian Richard Hofstader would have us believe. While we abhor Jefferson's slave holding ways, there's much to be admired in his prose--and the seven-year crop rotation outlined here is to die for.
Image: Will there be a Lake Okabena Pork Party, following the example of revolutionary American patriots? Since the Worthington Windsurfing Regatta & Music Festival has passed for 019, perhaps the area's yeoman farmers--many working on pork production contracts with large concerns--will have to pick a more environmentally-friendly protest than throwing pigs or pork in the lake (regardless of this inspiring example).
If you appreciate our posts and original analysis, you can mail contributions (payable to Sally Jo Sorensen, 600 Maple Street, Summit SD 57266) or use the paypal button in the upper right hand corner of this post. Those wishing to make a small ongoing monthly contribution should click on the paypal subscription button.
Or you can contribute via this link to paypal; use email [email protected] as recipient.
Comments