October 25, 2018 / 7:50 PM / 2 years ago

Republican senator decries USDA aid for Smithfield unit of China's WH Group

WASHINGTON (Reuters) - A prominent Republican on the U.S. Senate Agriculture Committee complained on Thursday about Chinese-owned Smithfield Foods Inc receiving aid from the U.S. Department of Agriculture meant to help American farmers hurt by China’s trade tariffs.

U.S. Senate Judiciary Committee Chairman Senator Charles Grassley questions FBI Director Christopher Wray and U.S. Department of Justice Inspector General Michael Horowitz during a Judiciary Committee hearing “Examining the Inspector General’s First Report on Justice Department and FBI Actions in Advance of the 2016 Presidential Election” on Capitol Hill in Washington, U.S., June 18, 2018. REUTERS/Joshua Roberts

“I don’t understand why Chinese owned Smithfield qualifies for USDA $$ meant to help our farmers,” Senator Charles Grassley of Iowa wrote on Twitter. Smithfield, the world’s biggest pork processor, is a unit of Hong Kong-based WH Group Ltd (0288.HK).

A spokeswoman for Smithfield rejected that it has applied for federal assistance, saying the company was not eligible for the direct payment program.

Instead, she said it was involved in a program that was to supply the USDA with requested and domestically produced products which aimed to support pork prices for producers.

“Any approved vendor that can supply the requested product can bid for the contract. Any business can become a vendor if it meets certain requirements from USDA and is approved to supply products to USDA. As an American pork company, Smithfield meets these requirements and has been an approved vendor for many years,” she said.

In July, the Agriculture Department announced a $12 billion aid package for U.S. farmers hurt by retaliatory tariffs from American trading partners. The program includes $1.2 billion in purchases of commodities, including pork.

But Secretary of Agriculture Sonny Perdue earlier this month said the aid could end up being smaller following the announcement of a new trade deal between Canada, Mexico and U.S. to replace the North American Free Trade Agreement, known as NAFTA.

The United States has slapped tariffs on $250 billion worth of Chinese goods this year as part of Republican President Donald Trump’s vow to cut the U.S. trade deficit with China.

Beijing retaliated by hitting $110 billion of U.S. products, including the agriculture sector.

Grassley has represented farm state Iowa in the U.S. Senate since 1981, making him one of the most senior Republicans in the chamber.

Reporting by Tim Ahmann; editing by Eric Beech, Jonathan Oatis and Diane Craft

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