Morell Fined for GIPSA Breaches

by 5m Editor
26 September 2011, at 8:00am

US - John Morrell & Co, part of the giant Smithfield Foods group, is to pay a $162,500 civil fine for undervaluing pig carcases and falsifying records at slaughterhouses in Sioux Falls and Sioux City, Iowa.

The company has said the underpayments were a mistake that is is working to put right.

A report in the Argus Leader said that according to a complaint filed last year with the US Department of Agriculture's Grain Inspection, Packers and Stockyards Act (GIPSA) unit, Morrell had agreed to pay sellers for "lost identity" carcases, for which no lean-percentage value was recorded. The company was supposed to value these carcases based on the average weight and lean percentage of the lot.

But from 2005 to 2007, the company substituted an "arbitrary" lean percentage of 53 per cent, which a subsequent investigation found to be low.

The company used a Fat-o-Meat'er to measure fat levels in teh carcases.

GIPSA sampled 48 shifts at the two plants from June 2005 to April 2007 and found that 6,739 hogs of 354,834 were ungraded and labeled as 53 per cent lean. The actual average lean percentage for the lots, however, was above 54 per cent. The result, the complaint said, was "small amounts of loss for individual sellers."