August 30, 2014

Tyson To Divest Sow Purchasing Business

The U.S. Justice Department announced Wednesday that it will require Tyson Foods to divest Heinold Hog Markets in order to proceed with its $8.5 billion acquisition of The Hillshire Brands Company.  The department said it would require the sale of the sow purchasing business because the transaction with Hillshire would have combined companies that account for more than a third of sow purchases from U.S. farmers, thereby likely reducing competition for purchases of sows from farmers.  Tyson Foods, along with Hillshire, announced they have agreed with terms of the settlement.  Under the terms, Tyson must divest Heinold Hog Markets in its entirety to a buyer approved by the Antitrust Division. State Attorney Generals of Illinois, Iowa, and Missouri joined the department in the civil lawsuit filed Wednesday in the U.S. District Court for the District of Columbia to block the proposed transaction.

The acquisition of Hillshire by Tyson Foods would combine two major purchasers of sows from farmers in the United States and eliminate the benefit farmers have received from the competition between Hillshire and Tyson’s Heinold Hog Markets. said Bill Baer, Assistant Attorney General in charge of the Antitrust Division, stated “Without the divestiture, the proposed acquisition would have eliminated a significant customer for farmers’ sows and likely would have resulted in less competition in this important agricultural market.”

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EPA Releases Maps Detailing Waters of U.S. Rule

 Environmental Protection Agency released maps detailing the extent of the Waters of the U.S. proposal on Wednesday.  The maps were handed over to the House Committee on Science, Space, and Technology.  Similar maps were made by tthe National Cattlemen’s Beef Association and other agricultural organizations.  NCBA alleges the maps show individual states facing upwards of 100,000 additional stream miles that could be regulated under the proposed regulation.  NCBA’s Ashley McDonald called the maps “the smoking gun” for agriculture.  She stated “These maps show that EPA knew exactly what they were doing and knew exactly how expansive their proposal was before they published it.”

Knowledge of the maps came as the Committee was doing research in preparation for a hearing regarding the proposed Waters of the United States rule. The maps were kept hidden while the Agencies marched forward with rulemaking that fundamentally re-defines private property rights, said Chairman Representative Lamar Smith. He stated “Given the astonishing picture they paint, I understand the EPA’s desire to minimize the importance of these maps.”  You can see the maps online at www.science.house.gov.

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North Dakota Department of Ag, Port of Vancouver Announce Shipping Agreement

The state of North Dakota and one of the nation’s leading ports are teaming up to increase the shipment of North Dakota agricultural commodities to the West Coast, while bringing more supplies and industrial products into the state.

Agriculture Commissioner Doug Goehring and Todd Coleman, CEO, Port of Vancouver USA signed a memorandum of agreement Wednesday in Fargo, uniting the state and the port in a collaborative rail service program that supports both the agricultural and energy industries.

“This agreement provides more marketing opportunities for our identity-preserved and specialty crop products, such as food grade soybeans, peas, lentils, dry beans and other commodities, to be transloaded and containerized,” Goehring said. “It also provides a major opportunity for North Dakota commodity handlers, especially smaller and mid-sized companies, to access rail facilities on the same basis as larger companies, enabling them to remain competitive.”

“We expect this agreement to increase capacity and reliability for farmers needing to move their products to market by rail,” said Coleman. “Cargoes, specifically supplies for the energy industry, are already moving east from the Pacific Northwest to the Midcontinent. We’re taking it a step further by leasing boxcars to carry those eastbound cargoes and then, with the help of our logistics partners, filling these boxcars with agricultural products for the return trip to Vancouver.”

Coleman explained that the port’s responsibilities include designating load centers, managing boxcars, coordinating with BNSF Railway and providing monthly service reports.

Goehring said NDDA’s responsibilities include collection of production data, and communicating with the agriculture community, exporters and with small to mid-size shippers.

“We have been working at this more than a year,” Goehring said. “When the Port approached me about the possibility, I saw it as an opportunity to reduce the problem of trying to get out our wheat and other crops to market, a problem we have had for decades and one that has become a greater challenge recently. This agreement will not end that problem, but I believe it can go a long way to relieve it.”

“We’re looking at starting to move full boxcars from North Dakota as early as mid-September,” said Coleman. “The equipment and infrastructure are already there, and we’ll work together to optimize its use and get products moving west and beyond to markets in Asia and Latin America.”

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