AMES, Iowa – Yet another major farm organization has cast its vote against the proposed purchase of IBP by Smithfield. National Farmers Organization (NFO) announced last week it steadfastly opposes the acquisition, because regional and local hog markets could dry up for many U.S. producers.
"This deal could well mean the end to a free market system in America's livestock sector, which means open price discovery for the value of hogs simply could not happen," said Brian Harris, Director of Livestock for National Farmers. "The loss of another competitive player could lead quickly to a monopolistic domination of markets, and further fuel the demise of an independent hog producing system."
The constant barrage of mergers has left many hog producers in doubt of
their very survival. Despite low grain prices, many still have trouble cash flowing their operations. As the overall percentage of packer contract production grows, independent producer hogs are used as secondary supply, which means fewer tested markets, and dwindling opportunities for fair price discovery.
"Agricultural producers and consumer stakes are skyrocketing in this
merger-mania madness," underscored Harris. "We're calling for a united
effort by agricultural producers and Washington to bring these mergers to a halt. Enough is enough."
The organization supports Sen. Tom Daschle's move urging Attorney
General Janet Reno to work closely with the Secretary of Agriculture to
scrutinize the purchase. IBP is the world's largest beef processor, and
Smithfield is the largest pork producer in the world. "Time is running out for our producers who are being squeezed by large agribusiness day in and day out," said Daschle. "They have a right to expect a free and competitive marketplace."
National Farmers Organization supports instituting a moratorium on agribusiness mergers until Congress approves more comprehensive legislation.
National Farmers Organization