Administration Defends Own
Handling Of Ag Merger Issue

WASHINGTON —(AP)— Existing antitrust laws are adequate to protect the interests of farmers and consumers as agriculture and food processing companies go through a wave of mergers and acquisitions, the U.S. Justice Department insists.

The regulations provide the ``appropriate framework for policing and enforcing our nation's concerns about the ability of markets to operate competitively,'' said John Nannes, a deputy assistant attorney general for the department's antitrust division.

He told the House Judiciary Committee last week that any significant mergers ``are going to get a very careful look'' from the department.

The farm economy is stuck in its worst downturn since the mid-1980s, and although economists blame it on overproduction of crops and livestock, many lawmakers have been pointing to agribusiness mergers as a culprit. A handful of firms now control many segments of the agriculture and food industries, including meat processing and grain shipping.

Last week, several Senate Democrats who believe the administration's antitrust enforcement has been lax said they intend to force a vote in the Senate on an 18-month moratorium on further mergers of agricultural or food companies. The administration would be required to do a study of the industries during the moratorium.

Several lawmakers told the committee Wednesday that Congress should consider tightening antitrust laws to curb the consolidation.

``Congress should act deliberately, but also with broad and bold strokes,'' said Rep. John Thune, R-S.D. ``The net result should be a system that fosters true competition for all those participating in it.''

Earlier this year, the department allowed Minnesota-based Cargill Inc., North America's second-largest grain trader, to acquire the grain operations of Continental Grain, provided the companies sold some of their facilities. Congressional critics of the department don't think the deal ever should have been approved.

Last year, the department forced Monsanto to spin off some corn technology interests before it could acquire DeKalb Genetics Corp.

Those actions ``ought to be an indication that we are watching market trends very carefully in the agricultural marketplace,'' Nannes said.

In one of the latest deals before the department, Smithfield Foods Inc. of Smithfield, Va., the biggest pork processor as well as the largest hog producer, is seeking the department's approval to acquire number two producer Murphy Family Farms of Rose Hill, N.C.

The Agriculture Department is doing what it can, including expanding its economics and legal staff, to ensure that meatpackers treat livestock producers fairly, said Enrique Figueroa, USDA's deputy under secretary for marketing and regulatory programs.