Mindi Schneider, a researcher in Cornell’s College of Agriculture and Life Science Development Sociology department, discusses the business and social implications of a Chinese company acquiring Smithfield Foods.
Media note: Schneider’s research focuses on the Chinese pork industry, agribusiness, and smallholder farming. She is the author of a 2011 report published by the Institute for Agriculture and Trade Policy called "Feeding China's Pigs: Implications for the Environment, China's Smallholder Farmers and Food Security."
Schneider says: “The proposed takeover of U.S.-based Smithfield Foods by the Shuanghui Group, China's largest meat products firm, is an example of how Chinese companies are changing the nature of transnational agribusiness. Shuanghui is a former state-owned enterprise, which is now publicly-traded, but retains strong ties to central and provincial governments through its leadership structure and through state financial and policy supports.
“Shuanghui's acquisition of Smithfield is related to the government's more general 'go out' strategy, a set of policy supports to increase the reach of Chinese firms internationally. It is also a very particular pork-sector phenomenon, as pork is the so-called ‘national food.’ Its increased consumption signifies progress against a backdrop of scarcity, its steady supply is considered important in heading off social unrest, and its availability and distribution are ways to build a predominantly urban middle class.
“Chinese consumers prefer fresh cuts of pork. If Shuanghui imports packaged pork products from its new production and processing centers in the U.S., the company will also be playing a role in transforming consumer tastes and preferences, and therefore, consumer demand.”
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