Buffalo River Watershed Alliance
By Ginny Masullo and Lin Wellford,
Special to the Democrat-Gazette
Recently, the Arkansas Department of Environmental Quality opened yet another public-comment period concerning the latest modification request for the Cargill-contracted confined animal feeding operation, C&H Hog Farms in Mount Judea. This time they are proposing to empty the two open lagoons containing the waste of 6,500 swine to install synthetic liners, a cover and a methane flare.
Two years ago when this facility was built, we were told it was a state-of-the-art operation. Jerry Masters, vice president of Arkansas Pork Producers, wrote a guest column assuring the public that it was extremely unlikely that any hog waste would ever get loose from the "over-engineered" clay-lined lagoons.
Research shows that not only is lagoon leakage common, it is so probable that state regulations allow the lagoons to leak up to 5,000 gallons per acre of lagoon per day. At an Environmental Quality hearing held in Harrison, Farm Bureau Environmental Specialist Evan Teague told the crowd that clay liners are actually designed to leak--until they become plugged up with waste. So, how much waste may have leaked into the ground under C&H? No one can say, since there was no requirement to install a leak-detection system. Where the waste might go is also an open question. No dye-testing was allowed by C&H on the property. What we do know is that the area sits on karst, a highly permeable fractured limestone substrate. It's the reason you see so many gushing springs in the Ozarks after it rains.
The public was also told repeatedly that Cargill/C&H had jumped through all the regulatory hoops, even though many questioned from the outset how the more time-consuming aspects of the process, like the environmental assessment, could have been completed so quickly.
Upon careful review, a judge ruled that, in fact, very little was done to effectively evaluate the potential environmental impacts of this swine operation on a sensitive watershed. No mention was even made of the presence of the Buffalo National River, or that Big Creek, which abuts the spray fields, is a major tributary. The judge termed the assessment "cursory and flawed," and directed that a proper assessment be conducted.
But in the meantime, millions of gallons of hog waste have been sprayed onto pastures surrounding the facility. We can't turn back the clock to the conditions that existed prior to when this CAFO began operations. But we do have the results of a very comprehensive study of the Buffalo River conducted by biologists for the National Park Service over a 10-year period from 1985-1995. At that time, the study concluded that while the water quality of the Buffalo was still excellent, agricultural runoff introduced through tributaries presented a growing threat that needed to be addressed.
With time, so much more has come to light, casting doubt on the motives and veracity of those involved in getting the CAFO swiftly up and running, that it seems only natural to continue asking questions:
Corporate agri-business likes to claim that it is only trying to feed a hungry world, but the reality is that it is reaping major profits by using contract growers who don't own any part of the animal except its waste. Ultimately human survival requires working together to sustain the environment which supports all living things.
Trading our shared resources for cheap pork is no bargain! The real price tag already promises to be more than any of us can afford.
Ginny Masullo of Fayetteville and Lin Wellford of Green Forest are two founding members of the Ozarks Water Stewards, a group devoted to bringing awareness of the value of the Ozark Plateau's shared water resources. The public can email comments to Water-Draft-Permit-Comment@adeq.state.ar.us.
Editorial on 07/27/2015
By Mike Masterson
Arkansasonline
Posted: July 18, 2015 at 3:37 a.m.
The hype surrounding vaporized hog waste in the Cargill-supplied C&H Hog Farms (it's a factory) in the Buffalo National River watershed has lots of folks waiting and watching for the Plasma Energy Group of Florida to show what it claims it can do.
As of last week, this supposedly revolutionary method for safely disposing of something as potent and foul as hog waste remained just talk. Cargill has been waiting for the prototype, and it hasn't heard from Plasma Energy in about a month.
Still no prototype? A news account by reporter Emily Walkenhorst said the president of Plasma Energy reportedly will begin testing its electron-fired, waste-zapping condenser sometime in July at another state Cargill-sponsored hog factory called Sandy River Farm. If all goes well there, things could get cooking at the hog factory in the Buffalo River watershed in August.
Murry Vance, who heads Plasma Energy Group, has been quoted saying the results of his firm's technology will spew fewer emissions than does a commercial lawn mower. Now that's an impressive statement.
Plasma Energy Group better hope that proves true. The Arkansas Department of Environmental Quality (cough) warned the firm in October "that testing could result in enforcement action if the technology resulted in gas discharges that would require an air permit," Walkenhorst's story says. "The department had been unable to determine whether Plasma Energy Group needed an air permit because it did not receive enough data from the company on projected gas discharges from vaporizing hog waste. The company has vaporized some materials before, but never hog waste."
Vance told the reporter that liquid pig waste is easier to vaporize than "high solid" materials--like cow manure--his company is accustomed to vaporizing. Vance said he'd been using plasma arc pyrolysis technology since 1992. This process involves transforming material into synthetic gas.
The quantity of waste from C&H won't be large enough to turn into gas, so it would be broken down and vaporized using an electron discharge and heat. The resulting vapor would be condensed into "semi-pure" water.
Yet still the state waits for all this to unfold. The Department of Environmental Quality spokesperson said that office hadn't heard as much as a grunt from Plasma Energy since last October. Cargill says it wants everything about this approach to be not just OK, or good, but downright perfect before it's used at C&H.
Meanwhile, Mike Martin with Cargill said his privately held company is pursuing this new approach in an effort to allay fears that regularly spreading millions of gallons of hog waste from the 6,500 swine at C&H on fields around Big Creek (a major tributary of the Buffalo six miles downstream) could contaminate the country's first national river.
I've spoken with experts in karst terrain who already have performed subsurface water-flow testing, proving just how fast and far dye injected into the groundwater beneath this factory and across the area travels through the fractured limestone karst. These knowledgeable folks will tell anyone who will listen that it's only a matter of time before the Buffalo reflects the results of such huge amounts of waste being dumped on fields around Mount Judea.
Yet again I'm led back to the fundamental question of why the state ever considered permitting this hog factory into such a wrongheaded location ... into the crown jewel of our state's natural tourism attraction.
And look what is being spent to keep this factory operating. Our state is appropriating hundreds of thousands of our tax dollars annually solely to sponsor a University of Arkansas study of water quality around C&H in an effort to determine if the waste is permeating the watershed and river.
In other words, Arkansas is paying the state's flagship university to analyze what the state's environmental "protection" agency should never, ever have even approved.
Now those responsible for operating this factory will spend whatever's required to consider this specialized technology, also in order to keep the mess out of our national river watershed in this inappropriate location.
Then we have geosciences professor emeritus John Van Brahana who, with his diligent team of volunteers, has spent two years objectively analyzing the water quality and subsurface flow around the watershed. Who knows how much time and energy he and his group have invested in monitoring the unnecessary situation?
Did I mention the National Park Service and all the resources it also is having to devote to this factory it never knew was taking shape in its backyard because, conveniently enough, the state's environmental agency never told them how it was quickly and quietly pushing through the C&H General Permit.
Mike Masterson's column appears regularly in the Arkansas Democrat-Gazette. Email him at mikemasterson10@hotmail.com.
Editorial on 07/18/2015
Inside the world's largest food producer you've probably never heard of
This NPR report describes JBS, the Brazilian company which is purchasing Cargill Pork.
The World Eats Cheap Bacon At The Expense Of North Carolina's Rural Poor
http://qz.com/433750/the-world-eats-cheap-bacon-at-the-expense-of-north-carolinas-rural-poor/
By Emily Walkenhorst
This article was published today at 5:30 a.m.
Florida-based Plasma Energy Group plans to test new vaporizing technology on hog waste produced at Sandy River Farm in Conway County this month in hopes of eventually using the technology at C&H Hog Farms in Newton County to allay concerns of environmental groups upset about C&H's presence in the Buffalo River watershed.
Initially, Plasma Energy Group, C&H Hog Farms and Cargill -- which owns the hogs at C&H Hog Farms -- planned to test the technology on-site in Mount Judea, but Cargill spokesman Mike Martin said that changed after meetings with concerned parties in Northwest Arkansas. Cargill owns the Sandy River Farm facility and its hogs, and is choosing the site as a replacement outside the Buffalo River watershed, which is the area surrounding the river where water drains into it.
Cargill, a multinational agricultural corporation, can't begin testing until it receives a prototype of the technology from Plasma Energy Group, a Port Richey, Fla., company.
Cargill spokesman Mike Martin said the prototype wasn't ready yet and that his company hasn't heard from Plasma Energy Group in about a month.
Plasma Energy Group President Murry Vance said he believed the company would begin testing this month at Sandy River Farm.
"It will happen in July," he said. "I don't know the exact date yet."
If all goes well, Vance said, the company expects to begin using the technology at C&H Hog Farms in August.
Vance said last fall that his company would begin testing the vaporizing technology early in 2015. But Cargill wants to make sure "everything is perfect" before the technology can be used at C&H Hog Farms, Vance said.
The Department of Environmental Quality warned Plasma Energy Group in October that testing the technology could result in enforcement action if the technology resulted in gas discharges that would require an air permit. The department had been unable to determine whether Plasma Energy Group needed an air permit because it did not receive enough data from the company on projected gas discharges from vaporizing hog waste. The company has vaporized some materials before, but never hog waste.
Department of Environmental Quality spokesman Katherine Benenati said department officials have not heard anything new from Plasma Energy Group since last fall.
Vance said he hasn't spoken to anyone at the department since October.
Meanwhile, Vance has maintained his plans, saying last year that the size of the machine that would be used would produce less emissions than a commercial lawn mower.
He said his company has since been testing cow manure and other waste without any problems. Liquid pig waste is easier to vaporize than "high solid" materials his company is used to vaporizing, he added.
Plasma Energy Group started in 2013, but Vance has said he has been using the vaporizing technology -- called plasma arc pyrolysis -- since 1992. Plasma arc pyrolysis typically involves the conversion of material into synthetic gas. In the case of C&H, Vance has said the waste won't be turned into synthetic gas because the quantity of material won't be large enough.
The method proposed for the C&H farm would break down the hog waste and vaporize it using an electron discharge and some heat, then condense the water vapor into "semi-pure" water that's put back into the plant.
Plasma Energy Group's contract is with C&H Hog Farms, but Cargill officials have been looking for ways to address the environmental backlash against the company for its involvement with C&H Hog Farms' construction on Big Creek, 6 miles from where it meets the Buffalo National River.
Vaporizing is a possible way to reduce the volume of waste from the facility that is spread on fields for agricultural purposes.
"Cargill's willing to conduct that [plasma arc pyrolysis testing] at Sandy River, and we believe it's the right thing to do," Martin said.
"The thought behind looking at this technology is that there are those who believe that spreading manure on crop fields in the Buffalo River watershed near C&H Hog Farm is going to result in the manure somehow getting into the water," Martin said.
"And so we have looked at a number of technologies or explored a number of ideas or options -- most of them are conceptual, such as plasma energy concept. The thought behind that is if we can reduce the volume that is spread on the fields by employing some other technology that will cost-effectively eliminate the waste, even though we feel it has a legitimate purpose as a fertilizer, that could potentially allay the concerns out there that fertilizer might get into the water system."
Environmental groups have been concerned about the potential for a hog waste lagoon failure that would run into Big Creek and then into the Buffalo River, in addition to concern that the rough karst terrain surrounding the river would lead to elevated pollutants from hog manure applied to the ground for agricultural purposes.
A University of Arkansas System Division of Agriculture study is looking at the impact of runoff into Big Creek and the waste ponds themselves.
In May, C&H submitted a proposed modification to its permit to add covers on the hog waste lagoons that would capture gas emitted from them and then send it through an upward pipe to flare and burn it.
Gordon Watkins, president of the Buffalo River Watershed Alliance, which was formed in response to C&H Hog Farms' construction in 2013, said Cargill's time, energy and money might be better spent moving the operation out of the watershed.
"Generally ... they seem to be throwing every technology at this thing to try and make sure it stays where it's located," Watkins said.
The Buffalo National River -- the country's first national river -- is a popular tourist spot, with more than 1.3 million visitors in 2014, who spent about $56.5 million at area businesses, according to National Park Service data.
C&H Hog Farms is permitted to hold up to 2,500 sows and 4,000 piglets at a time. Small hog farms have existed in the watershed for years, but C&H is the first large-scale hog facility in the watershed.
On Monday, a state legislative committee advanced a proposed five-year ban on new medium or large hog farms in the watershed.
Metro on 07/13/2015
Newton County Times
Posted: Friday, July 10, 2015 12:00 pm
0 comments
JBS USA Pork has entered into an agreement with Cargill to acquire the company’s U.S.-based pork business for $1.45 billion. Completion of the acquisition is subject to regulatory review and approval. C&H Hog Farm located at Mt. Judea is a Cargill contracted grower.
A press release on Cargill’s websit dated July 1 states, “Today’s announcement of our agreement to purchase the Cargill pork operations is a strategic investment in the long-term growth of our domestic and global pork business and demonstrates our continued commitment to the U.S. livestock sector,” said Martin Dooley, president and COO of JBS USA Pork. “This transaction will strengthen our position as a producer and supplier of all major animal proteins around the world, and provide increased opportunities for our producer partners and key customers. The strength and success of Cargill’s pork team and hog suppliers, as well as its industry leadership in areas such as animal welfare, exports, bacon production and innovation, were significant and compelling factors that led us to pursue this acquisition and enhance our ability to serve our diverse, global customer base.”
Included in JBS’ acquisition of Cargill’s pork business are two Midwest meat processing plants, one in Ottumwa, Iowa, and the other at Beardstown, Ill. Both plants were acquired by Cargill in 1987, and in 2014 they processed a total of 9.3 million hogs. The purchase by JBS also includes five feed mills (two in Missouri, and one each in Arkansas, Iowa and Texas), and four hog farms (two in Arkansas and one each in Oklahoma and Texas).
“The strengths of the JBS and Cargill pork businesses are complementary. Together, they promise to offer enhanced service to customers and more opportunities for employees and hog producers while providing an important source of protein to consumers around the world,” said Todd Hall, Cargill senior vice president. “The professional and focused manner in which JBS approached Cargill demonstrated to us that they place a great deal of value on growing this part of their company to better compete in the marketplace and are willing to invest in its future. JBS is acquiring a business with excellent people and fixed assets, and an established track record of success.”
JBS first entered the U.S. pork market with the acquisition of Swift & Company in 2007 and has steadily improved performance ever since. The company has more than 6,000 team members and the total daily capacity to process more than 50,000 hogs at processing facilities in Marshalltown, Iowa; Worthington, Minn.; and Louisville, Ky. JBS USA Pork offers a wide selection of well-known brands including Swift® and Swift Premium®. The announced transaction will enhance JBS USA Pork’s ability to meet increasing global demand for high-quality, innovative fresh and frozen pork products.
Cargill spokesman Mike Martin said the Minnetonka-based company was not actively looking to sell the business. “JBS approached us with an offer we had to consider,” he said, adding this was a move by JBS to better vertically integrate itself into the U.S. pork industry. Specifics of the acquisition were only recently formulated after JBS approached Cargill with a deal in June.
JBS introduced itself to the U.S. pork market in 2007 with the purchase of Swift & Company, a Colorado meatpacker. The company currently employs 6,000 workers and processes more than 50,000 hogs daily at facilities in Worthington, Marshalltown, Iowa and Louisville, Kentucky.
JBS will assume 5,100 Cargill employees following the transaction with no plans to remove or replace any workers. “Part of the attraction JBS had was of the people component,” said Martin.
President and COO of JBS USA Pork, Martin Dooley, called the purchase a “strategic investment” in a statement, adding that “the strength and success of Cargill’s pork team and hog suppliers were significant and compelling factors that led us to pursue this acquisition and enhance our ability to serve our diverse, global customer base.”
“The strengths of the JBS and Cargill pork businesses are complementary,” said Todd Hall, senior vice president at Cargill, in a statement. “JBS is acquiring a business with excellent people and fixed assets, and an established track record of success.”
According to the U.S. Department of Agriculture, the U.S. is the third largest global pork producer, trailing China, who produces half of the world’s pork, and the European Union. The same rankings apply in terms of total domestic consumption. Hog processing numbers are up 6.4 percent this year in the U.S., a surprising recovery considering the death of approximately 9 million pigs last year to the porcine epidemic diarrhea virus.
Cargill remains a top meat producer in the U.S. market. The agribusiness behemoth still maintains a foothold in beef, poultry, and other production areas.
“Fresh pork will all go to JBS,” Martin stated, but Cargill will preserve its production of pork products such as hot dogs and cooked ham meats.
Although Cargill does not disclose exact figures, Martin confirmed that their pork production numbers were “considerably smaller than the beef business but larger than the turkey business in the U.S.”
—By Tom Philpott
| Wed Jul. 8, 2015 6:00 AM EDT
While Americans celebrated Independence Day last weekend, the meat industry was partaking of another time-tested tradition: concentration. That's the economists' term for when one big company buys another, resulting in an industry dominated by just a handful of players. And that's what happened when Brazilian meat giant JBSplunked down $1.45 billion to buy the US pork interests of global agribusiness behemoth Cargill.
Sure, the US pork market was already pretty top-heavy before that deal, which won't be consummated until US antitrust authorities approve it. As things stand now, even before the proposed merger, the big four pork packers (including JBS, through its Swift subsidiary) control a hefty 64 percent of the US pork market.
If the deal goes through, the combined JBS/Cargill operation will push out Tyson for the number two slot, Hormel will slide into fourth place, and the new Big Four will slaughter 71.5 percent of the hogs raised in the US. That's a significant concentration of an already-concentrated market.
Phil Howard, a Michigan State University researcher who studies corporate control of the food system, says the deal is "bad news," because "JBS will have even more power to drive down the prices it pays to farmers, and drive up the prices it charges to consumers." He notes that just two companies, Smithfield and JBS, would together own 45.5 percent of the pork market, "moving closer to the Coke/Pepsi model of domination by just two giant firms."
He also notes that Smithfield and JBS are both foreign-owned—JBS, the globe's largest meat company, is based in Brazil, while Smithfield has been owned by the Chinese meat conglomerate Shuanghui since 2013. So why are outside firms muscling into the US pork market? After all, US demand for "the other white meat" isn't exactly cooking. The opposite, in fact.
So, rather than making a play for the domestic pork market, these foreign players are likely aiming to cash in on a rising trend: exports of US-grown pork.
Now, you may note that exports soared through the 2000s and have leveled off more recently. That's why the National Pork Producers Council, the industry's trade group, has been promoting the Trans-Pacific Partnership (TPP), the vast proposed trade pact that President Obama and his GOP Congressional allies have been hustling to pass. In a post last year, I laid out why the US meat industry loves the TPP: Namely, it would open the floodgates to lucrative markets in Japan, Vietnam, and Malaysia, all of which limit imports of US meat to protect domestic farmers. "A good TPP agreement ... would result in exponential growth in US pork exports," the Pork Producers Council declared in a June press release. It is perhaps not a coincidence that JBS made its lunge for Cargill's pork operations just two weeks after the TPP process took a major leap forward, when Congress voted to give Obama "fast track" authority to negotiate trade deals.
So, why shouldn't US farm country emerge as the globe's pork-export powerhouse? As the Pork Producers Council puts it, the US is "one of the lowest cost producers of pork in the world." Indeed, a 2012 USDA report found that it's cheaper to produce pork here than it is in China. But we should remember what it means to be the low-cost producer of a commodity like pork—as muckraking books like Ted Genoways'The Chain and Barry Estabrook's Pig Tales shows, the industry abuses labor, fouls the air and waterways, and hollows out rural towns as a matter of course. "Exponential growth in US exports" would be great for our ever-growing pork behemoths; but it's hard to see what's in it for the rest of us.
Posted: July 7, 2015 at 2:57 a.m.
Well, slice my pork chops thick and fry my bacon crispy, a Brazilian-based protein producer has agreed to purchase Cargill's U.S.-based pork business for $1.45 billion.
The news story appeared in the paper late last week.
And yes, that would be the same Cargill based in Minnesota that supplies and supports the controversial C&H Hog Farms at Mount Judea, which operates smack in the middle of the Buffalo National River watershed.
JBS USA Pork, a unit of Sao Paulo, Brazil's JBS SA, made the offer, which still has to leap regulatory hurdles before being finalized. JBS already is majority owner of Pilgrim's in the U.S., and owns Tyson poultry operations in Mexico and Brazil.
The news account also said JBS USA will gain two Midwestern meat-processing plants, one in Iowa and the other in Illinois. It also would gain four hog farms (what say we call them what they truly are, swine factories). Two are in Morrilton and Umpire in Arkansas, and one each in Oklahoma and Texas. There also are five feed mills involved in the deal: Two in Missouri and one each in Arkansas, Iowa and Texas.
Curiously, there was no mention in this sale of that hog factory perched on a hill above Big Creek, a major tributary of the Buffalo flowing just six miles downstream. I presume that means the good folks at Cargill could be holding onto that operation.
Should JBS inherit this factory, many out here naturally wonder what it will do to resolve the legitimate concerns of folks across the country who cherish the purity of our country's first national river.
Meanwhile, in their press release, JBS executives sounded practically tickled pink by their mega acquisition: "This operation is in line with JBS' strategy to grow its portfolio of prepared and value-added products, expanding the company's customer base both in the domestic market and internationally."
Todd Hall, senior vice president of Cargill, seemed equally enthused. "The strengths of the JBS and Cargill pork businesses are complementary," he's quoted saying. "Together they promise to offer enhanced service to customers and more opportunities for employees and hog producers while providing an important source of protein to consumers around the world."
Hall continued: "The professional and focused manner in which JBS approached Cargill demonstrated to us that they place a great deal of value on growing this part of their company to better compete in the marketplace and are willing to invest in its future. JBS is acquiring a business with excellent people and fixed assets, and an established track record of success."
Martin Dooley, president and COO of JBS USA Pork, which processes more than 50,000 hogs daily at facilities in Iowa, Minnesota and Kentucky, said, "This transaction will strengthen our position as a producer and supplier of all major animal proteins around the world, and provide increased opportunities for our producer partners and key customers. The strength and success of Cargill's pork team and hog suppliers, as well as its industry leadership in areas such as animal welfare, exports, bacon production and innovation, were significant and compelling factors that led us to pursue this acquisition ..."
Another aspect to this deal is Cargill's pledge never to place another of its potentially polluting hog factories in the hallowed Buffalo watershed. Are the men from Brazil, if it applies, ready and willing to honor that pledge? Gov. Asa Hutchinson's proposed amendment to two regulations that would create a five-year ban on hog factories in our watershed looks better than ever to me.
Editorial on 07/07/2015
Posted: July 7, 2015 at 4:45 a.m.
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A joint meeting of the Legislature's Public Health, Welfare and Labor committees reviewed with no objection Monday a proposal to ban new medium or large hog farms in the Buffalo National River watershed for the next five years.
The joint committee, which met Monday morning on state Capitol grounds, declined twice in 2014 to declare the hog farm ban "reviewed." Review is a required part of the rule-making process.
The issue faces a few more steps before the rule can be adopted.
The initial rule proposed a permanent ban on medium and large hog farms in the watershed as a means of protecting the area's environment and was supported by former Gov. Mike Beebe.
But legislators criticized the rule for not accounting for the University of Arkansas System Division of Agriculture study of the effect on water quality of C&H Hog Farms in Mount Judea -- the hog farm that spawned criticism, changes to public notice on hog-farm applications in the watershed and the proposal of the rule being considered Monday.
Gov. Asa Hutchinson's staff met with sponsors of the permanent ban -- the Arkansas Public Policy Panel and the Ozark Society -- and suggested reducing the ban to five years with the option to make it permanent later.
After the hearing, an attorney for the rule-making groups, Sam Ledbetter, said he believed the governor's support was instrumental in making the review finally happen.
"That's been very helpful," he said. Ledbetter is an attorney at McMath Woods.
Before the rule went to a hearing Monday, legislators suggested that the rule be changed further to require the Arkansas Department of Environmental Quality director to initiate rule-making procedures in five years to either delete the ban entirely from agency regulations or to adopt it permanently. The change essentially ensures lawmakers will have decision-making power on the rule five years after its adoption instead of now.
On Monday, after asking a few questions, legislators raised no objections to reviewing the rule.
Both changes to the rule were key factors in getting it reviewed, said Sen. Cecile Bledsoe, R-Rogers.
"We have paid for a report from the University of Arkansas, and I think it's really important that we look at the report to see what the science is before making decisions," she said after Monday's meeting.
Bledsoe also said legislative oversight of the rule down the road was important for accountability in the rule-making process and with Arkansans who voted for last fall's ballot initiative requiring legislative review of agency rule-making.
"I think it went well," she said of Monday's meeting.
The review means the rule can now go before the Rules and Regulations Committee. The committee will consider the rule for review and then report its decision to Legislative Council, which would then accept the report.
Should the rule be successfully reviewed, it would move back to the Arkansas Pollution Control and Ecology Commission for final adoption.
The commission is made up of state agency and gubernatorial appointments and is the Arkansas Department of Environmental Quality's appellate body. It approved the initiation of the rule in April 2014 and subsequently approved three six-month bans on hog-farm permits in the watershed until the rule-making was resolved.
Banning medium and large hog farms means no new facility can have more than 750 swine weighing 55 pounds nor more than 3,000 swine weighing less than 55 pounds.
C&H Hog Farms along Big Creek, 6 miles from where it meets the Buffalo River, is permitted to hold up to 2,500 sows and 4,000 piglets at a time. It was awarded an expedited general permit in late 2012 with little public input.
Although approval of the hog farm became a flash point for change at the state level, the farm would not be affected by the rule, even if it falls out of compliance with its permit, because it is in active permit status at the time of the rule-making, said Department of Environmental Quality Deputy Director Ryan Benefield.
In the five years of the rule being in place, however, the facility would not be able to expand.
Rep. Kim Hammer, R-Benton, asked if recent heavy rains had led to failures of the hog waste ponds at the farm, referencing concern from environmental groups that severe weather could cause the lagoons to fail.
Benefield said the lagoons had not failed.
After the meeting, Ledbetter reiterated that catastrophic lagoon failures haven't happened in Arkansas but that they have happened in other states, damaging waters.
Environmental groups are also concerned that hog manure applied to fields in the watershed would run off or filter into nearby waterways and accumulate in too-high levels, damaging the river.
The University of Arkansas System Division of Agriculture study is measuring runoff, in addition to the effect of rainfall on the hog farm's lagoons.
The study has been funded for the next four years as a part of the state budget approved by the Legislature this spring.
The Buffalo National River -- the country's first national river -- is a popular tourist spot, with more than 1.3 million visitors in 2014 who spent about $56.6 million at area businesses, according to National Park Service data.
Since the debate began over C&H Hog Farms in 2013, pork producers have not applied for permits for medium or large hog farms in the watershed, with Cargill -- involved with nearly all of the state's hog farms -- instituting a self-imposed permanent ban on hog farms in the watershed. Cargill owns the C&H Hog Farms' hogs.
Metro on 07/07/2015
US - Cargill and JBS USA decided to launch some fireworks this week when they announced that JBS would buy Cargill’s pork business, write Steve Meyer and Len Steiner.
This was a very well-kept secret as we have found no one that saw this coming. JBS will pay $1.45 billion for all of Cargill’s current pork business including packing plants, feed mills and hog production facilities.
Included in the sale:
So why is is this deal being done and what happens next? JBS has been aggressively buying meat and poultry assets all over the world the past few years so the fact that they are buying is no surprise.
This will be, to our knowledge, their first foray into primary hog production — at least on any scale as significant as this. According to Successful Farming’s 2014 Pork Powerhouses listing of the nation’s largest pork producers, Cargill ranked 8th with 161,000 sows.
JBS is already quite familiar with vertical integration, though, as it is the majority shareholder in Pilgrim’s Pride, a major US chicken producer.
Cargill did not say why it is exiting the pork business. Its press release did say it was not looking to sell but JBS made an offer that demanded consideration. Cargill has long been the fourth largest US pork slaughter firm, trailing Smithfield, Tyson and JBS.
At least one analyst speculated that the inability of moving to one of the top two spots in the industry — the General Electric philosophy, we think — might have been a factor in accepting JBS’s offer.
Pork margins were record high last year on robust domestic demand and PEDv shortened hog and pork supplies.
They have fallen back to more normal levels so far in 2015 but it could well be that Cargill’s management believed that these assets might never have this much value again, especially given the recent completion of the Texas production facility.
The sale is subject to regulatory review and approval and will likely get some close scrutiny from the Department of Justice (DOJ). Putting together the 3rd and 4th largest pork packers will increase the industry’s four-firm concentration ration (CR-4) by 8.2% to 63.0% by moving Hormel to the #4 spot in the rankings.
More importantly, combining these high-ranking companies will drive up the Herfindahl-Hirschman Index (HHI) by about 190 points. The HHI is a measure of concentration computed by summing the squares of each company’s market share.
The pork packing sector has been classified as moderately concentrated for several years due to its HHI of around 1300. We say “around” because our calculations are based on rated capacity and not actual slaughter since we do not know what actual slaughter was for each company.
This merger will move the HHI to about 1500, still well short of DOJ’s 1800 demarcation of a highly concentrated industry. But any increase of 100 points or more in a moderately concentrated sector “raises significant competitive concerns” according to DOJ merger guidelines.
JBS and Cargill are direct competitors for hogs in eastern Iowa for their Marshalltown and Ottumwa plants and in southern Illinois when procuring hogs for their Louisville and Beardstown plants.
The merger does not change concentration in hog production but will almost certainly become a political football for presidential candidates desperately seeking attention in Iowa.
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