Is Foreign Ownership in Pork More Dangerous Than Farmland?

Few news items in the ag media enjoyed the endurance of the discovery that Chinese owners have amassed nearly 400,000 acres of U.S. farmland.

These reveals seldom include any numbers to put this acreage in perspective. Like the fact the U.S. has 900 million acres of farmland, with over 350 million in crop land. One numerically challenged legislator even proclaimed this tiny sliver of land represented a threat to the U.S. food supply. 

In fact, Arkansas recently ordered Syngenta to sell 160 acres of farmland in the U.S. state within two years because the company is Chinese-owned, drawing a sharp rebuke from the global seed producer.

U.S. farm groups and lawmakers are increasingly scrutinizing foreign land ownership due to concerns about national security.

All this would be simple political-xenophobic silliness, but for the fact that they were looking at, but not recognizing, a larger threat to U.S. farms and food consumers. In 2013, the Chinese industrial meat-packing conglomerate Shineway (U.S. spelling) purchased Smithfield farms and about 150,000 acres surrounding their plants and production facilities. At the time, it comprised about a quarter of American pork slaughter. Today, that number is around 20%. 

Lessons from Ukraine
Now consider the crumbling commercial relationships between the U.S. and China, as well as Xi Jinping’s ego-driven blundering on economic policy, and add in what we are learning from the war in Ukraine. A starkly adversarial future with China is suddenly more conceivable. Taiwan is the likely focus, but how this conflict might play out is foreshadowed by Russia and Ukraine.

U.S. firms withdrew from Russia in protest. McDonald’s is a prime example, but the most potent blow to Putin’s economy was the quiet quitting of U.S. financial firms. It’s not a leap of imagination to apply that to a China-U.S. faceoff. What actions might a stern phone call from Xi persuade Wan Long, the chairman of WH Group (the parent of Smithfield Foods) to take in support of a Chinese invasion of Taiwan? A far-fetched idea for sure, but not if the Chinese leader requires a diversion.

As financially damaging as it would be, Xi surely knows interrupting Smithfield’s massive conveyor belt from piglet to plate would create chaos in pork markets and spread to a huge swath of our economy. From supermarkets to seed corn companies, it could likely dwarf the consequences to the ag economy from the pandemic. Ironically, seizing Chinese land holdings in retaliation will compound the disaster as Smithfield is the largest Chinese farmland holder.

Knowing such an idea would be financial self-mutilation didn't stop Putin. China’s military options promise catastrophe for their naval forces and limited ground success at best. In confrontation with the U.S., Xi will undoubtedly deploy economic weapons. Based on the political turmoil in China already swelling, Xi has shown a willingness to throw even billionaires like Wan under buses. Not to mention our pork industry.  

EDITOR’S TAKE:

It seems China is a force to be reckoned with relating to many aspects of the U.S. economy and policy decisions. They are also positioned to be a major geopolitical factor from today forward. China is being very strategic in their efforts to control the world. As this article points out, it’s not simply about the farmland they own, but perhaps even more consequential is the processing and distribution under their control in the U.S. and around the world. The economic consequences could be devastating. They are already supporting military initiatives that cause the U.S. to divert resources to other fronts, thus, making us more vulnerable as each day passes. Now throw in disruption to our food supply and we could be in real trouble.

This article should raise major concerns. We need to ensure that agriculture is always considered a national security interest in the U.S. Agriculture must always have a major say in formulating our economic and security policies. We must never take agriculture and food production and distribution for granted. Once we lose control of our agricultural infrastructure, we lose control of our future. Farmers and ranchers are the backbone of agriculture - and agriculture is the backbone of America. Be sure to let the farmers/ranchers in your area know that you are there for them, whether that means parts, service, sales or just moral support within your community and state.