Law School Discussion

Creekstone Farms v. USDA


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Creekstone Farms v. USDA
« on: April 23, 2006, 04:58:05 PM »
I am very curious as to what others think about this issue, particularly if you come from an agricultural background.  The following article is from the NY Times.  It is a little dated as Creekstone has now sued the USDA, but it does a good job of explaining the issues.

It isn't losing the Japanese market for filet mignon that bothers Bill Fielding most. It's losing the market for tongue.

Until a case of mad cow disease was found in the United States on Dec. 23, a tongue from his premium cattle fetched $17 in Japan. American wholesalers pay $3.50.

Asian buyers also paid more for the company's prime beef, but the real money was in the spare parts, said Mr. Fielding, chief operating officer at Creekstone Farms, a high-end beef producer with an ultramodern plant here in the flat Kansas corn belt. Mexico snapped up his stomachs and Russians paid 30 cents a pound for liver that goes for 8 cents domestically.

But after Dec. 23, foreign countries shut their doors. Creekstone lost 25 percent of its sales, laid off 45 of its 750 workers and idled its plant one to two days a week.

Japanese buyers assured Mr. Fielding that they would buy again if he tested his beef for the disease, formally known as bovine spongiform encephalopathy.

In response, he built a laboratory five feet from the overhead chain that carries skinned heads through the plant. His staff was trained in testing for mad cow, using a machine that gives results in seven hours, while the carcasses are still in the cooler.

But on April 9, the United States Department of Agriculture forbade Creekstone to test its cattle, saying there was ''no scientific justification'' for testing young steers like those Creekstone sells. Certifying some beef for Japan as disease-free, the department said, might confuse American consumers into thinking that untested beef was not safe.

Calling those arguments ''ludicrous,'' Mr. Fielding has threatened to sue. He says he only wants the freedom to please a big, fussy customer, and he accuses the department of bending to the will of the big meat companies that control 80 percent of the industry.

[A department spokesman said no official could individually discuss Mr. Fielding's accusations. But in a telephone news conference on Friday, Dr. Ron DeHaven, the new chief of the department's health inspection service, reiterated that he wanted to ''focus our resources on a science-based plan,'' which in the long run, he said, would be better for exports.]

Mr. Fielding, 57, spent 25 years running divisions of three meatpacking giants, Cargill, ConAgra and Farmland Industries, and is a former chairman of the American Meat Institute, the slaughterhouse industry's trade group. ''So I understand big packers,'' he said. ''They're exerting all the pressure they can.''

Creekstone slaughters 1,000 cattle a day. Mr. Fielding estimates that exporting the premium meat, along with tongues and other offal, brought in $220 per steer. Giving up that revenue because it is not allowed to do a test that costs $20 a head ''comes out to $200,000 a day that we don't capture,'' he said. ''Our long-term viability is very much at risk.''

In Japan recently, he saw free samples of Australian ''B.S.E.-free'' beef in stores that once sold his. ''That just kills me,'' he said.

The giants use slaughterhouses that can kill 400 cattle an hour but work on thin profit margins, he said. They do not want to build laboratories, train technicians, slow down cutting lines to take brain samples or build more cold-storage space. Pork and chicken profits will see them through the crisis and they would be happy, he argued, to see a troublesome competitor close.

J. Patrick Boyle, president of the American Meat Institute, which represents slaughterhouses large and small, said in a written statement that his group ''did not urge U.S.D.A. to respond negatively or positively to the Creekstone request.''

Top officials of the National Cattlemen's Beef Association, which represents 27,000 cattle ranchers, argued strongly in an interview that Creekstone should be stopped. Testing young animals, said Jan Lyons, the group's president, ''is like testing kindergartners for Alzheimer's.''

Terry Stokes, the chief executive, said, ''If you let one company step out and do that, other companies would have to follow,'' at considerable expense.

Mr. Fielding also argued that the decision contradicted a recent one on organic meat.

For nearly a decade, the department and big beef producers said in unison that the Europeans, who bar beef raised with hormones or antibiotics, were just being protectionist. American beef, they said, was perfectly safe but consumers would be confused if some was certified as hormone-free. Then, in 2002, the department reversed itself and began certifying organic beef.

Gary Weber, vice president for regulatory affairs at the cattlemen's association, said the difference was that organic beef producers were not legally allowed to imply that their beef was safer.

Creekstone Farms specializes in black Angus beef, and ships semen from its prize bulls in Kentucky to ranchers it buys from.

Its $200 million plant has what Mr. Fielding said were the nation's only indoor pens. Fans keep cattle from smelling blood, and they are urged forward to slaughter by long paddles, not electric prods. The plastic-coated sides of the ''kill box'' move in to hug them, so they do not collapse as a bolt is shot into their skulls.

Humane treatment of doomed animals may be an oxymoron, but it keeps the steaks tender.

''If you know you're going to be zapped, you tense up,'' Mr. Fielding explained. ''It changes the quality of the meat.''

Workers still on the line at the four-year-old plant are worried about their jobs.

''We always get fewer hours from Thanksgiving on because people are eating turkey and ham,'' said Alva Garcia, 38, who folds boxes for boxed beef. ''After New Year's, it usually picks up. This year, it didn't.''

She lost her house when her previous employer, another meatpacking company, closed. ''A lot of people gave up their homes, their cars, or moved to other states to look for work,'' she said.

Support for Creekstone is emerging from some Kansas Congressional representatives, state agricultural officials and small cattle ranchers. On Wednesday, former Senator Nancy Kassebaum Baker, who is married to Howard Baker, the ambassador to Japan, backed the company in a letter to Agriculture Secretary Ann M. Veneman. Ms. Veneman, a former food-industry lobbyist, has exchanged increasingly tense letters with Japanese agriculture officials, who expressed disappointment at her Creekstone decision.

Particularly galling to Mr. Fielding is this: In Japan, because of the shortage, Australian producers are getting up to $42 a tongue.


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Re: Creekstone Farms v. USDA
« Reply #1 on: April 24, 2006, 03:45:50 PM »
Well, I guess no one really cares.  Feel free to post even if you don't come from an agricultural background...just as long as it does not involve something like "anyone who eats meat should burn in hell" etc.

Re: Creekstone Farms v. USDA
« Reply #2 on: April 24, 2006, 04:07:14 PM »
I think the U.S. government (through agencies such as the USDA) should set minimum safety standards for food, as in "a producer has to do X, Y, and Z" to ensure that their product is safe.  If the company supplying food to the public wants to go above and beyond those safety standards and do additional tests, for whatever reason, they should be able to do so.  Anything else smacks of politics and politicians at their worst.