News roundup: Will a Chinese company own all the pigs in America?


Will a Chinese company own all the pigs in America?

Many of the holiday hams that Americans will eat during this festive season have been produced by a Chinese-owned company. Next year, the percentage will grow.

In 2013, China’s biggest pork producer, then called Shuanghui, acquired Smithfield Foods, America’s biggest pork producer, for $4.7 billion. At the time, the deal was “the most expensive acquisition by a non-state Chinese company overseas and also the largest Chinese investment in the United States.” Subsequently renamed WH Group, the same company announced this week that it intends to buy Clougherty Packing, California’s largest pork processor, from Hormel Foods Corporation, another global processed-meat giant. According to a Caixin report, the offer is for $145 million in cash, subject to regulatory approval. WH Group will take over the brands Farmer John and Saag’s Specialty Meats as well as farm operations in California, Arizona and Wyoming.

The deal is expected to close within 30 days, but Caixin comments that “U.S. president-elect Donald Trump’s hostile stance toward China could also become a major obstacle if the deal doesn’t close before he takes office on January 20.” However, the China aspect of the acquisition is, thus far, not attracting much attention in the U.S. media; for example, a short article about the deal in Food Engineering fails to mention WH Group at all, only reporting that the acquiring party is Smithfield Foods, the Chinese company’s wholly owned subsidiary. There is some interesting detail on the earlier acquisition of Smithfield Foods in this article: “How China purchased a prime cut of America’s pork industry.”

Other China stories to watch are linked below.

BUSINESS AND TECHNOLOGY:

  • Facebook said to create censorship tool to get back into China / NYT
    “The social network has quietly developed software to suppress posts from appearing in people’s news feeds in specific geographic areas, according to three current and former Facebook employees.”
  • China’s internet is flourishing inside the wall / Financial Times
    “A few years ago, China’s government seemed to be in conflict with the very nature of the internet, struggling to censor bloggers with millions of followers on Weibo, the Twitter-like service,” writes John Gapper. “Since then, it has shown that censorship can coexist with a vibrant online culture, as ecommerce and entertainment have taken over from political debate and the sharing of sensitive information.”
  • China arrests 3 workers from the Australian casino operator Crown Resorts / NYT
    The Australian government confirmed the arrests of the three in a brief statement, which did not name them. They were detained last month along with 15 other Crown Resorts employees, but no details about their situation were provided.
  • China has warned of retaliation if U.S. levies tariffs, commerce secretary says / WSJ
    U.S. commerce secretary Penny Pritzker noted that “the Chinese have said they’ll have to retaliate” if Trump seeks hefty tariffs on Chinese imports, and she also criticized Trump’s vow to withdraw the U.S. from the Trans-Pacific Partnership trade pact.
  • Surge in Chinese visiting U.S. to create jobs / China Daily
    “More than 3 million trips to the United States are to be made by Chinese tourists this year, directly creating about 45,000 jobs and indirectly creating 230,000 jobs in the U.S., as revealed during the closing ceremony of the 2016 China-U.S. Tourism Year on Sunday.”
  • SCMP appoints technology leader Liu to spearhead 113-year-old publication’s digital evolution / SCMP
    “The South China Morning Post has appointed technology leader Gary Liu as its chief executive officer, with effect from January 3, 2017. Liu is the former chief executive of New York-based news aggregator Digg, and previously led Spotify Labs at the Swedish music and streaming service provider.”

POLITICS AND CURRENT AFFAIRS:

SOCIETY AND CULTURE:

The editors

Jeremy Goldkorn, Anthony Tao, Lucas Niewenhuis, Jia Guo, and Jiayun Feng.