Bolstered by hundreds of millions of dollars worth of Wall Street financing, the company grew rapidly, adding 80,000 sows and a state-of-the-art processing facility in Milan.
But in 1995, the highly leveraged company filed for bankruptcy. Continental grain became the majority shareholder of the privately held company in 1996, purchasing a 51% stake in the operation.
Despite the renewed financial stability, the company has problems on another front. It is viewed as an example of the dangerous consolidation of agriculture into fewer and more distant hands.
Charlie Arnot, Premium Standard Farms Spokesman: "I think people need to understand that this is part of an on-going changing structure in agriculture, and Premium Standard Farms is more effect than cause. It's a different model than we've ever seen before. It's not based on independent agricultural production. Is it the right model? not for everybody. Uh, but I think communities that want to continue to sustain a quality rural way of life, have to begin to look beyond what we've always looked at in the past."
Rolf Christen runs a 200 head cow/calf operation near Green City, Missouri. His diversified farm also features horses, chickens and three hogs.
Just up the road, Christen's neighbor raises "a few more" hogs. So many more, that christen claims the operation is more factory than farm.
Rolf Christen: "I have got 80,000 hogs living 4 miles north of my house, and I've got 140,000 hogs, 8 miles south of my house. And, this is industrial production pork. This is not farm production for pork."
The hogs Christen refers to are owned by Premium Standard Farms of Kansas City, Missouri.
Marketing more than 2 million hogs annually, premium standard farms, or P-S-F is the 2nd largest pork producer in America. The vertically integrated company owns every step of the pork production process – literally, from semen to cellophane.
When P-S-F came to northern Missouri in 1989, the region was still enduring the farm crisis. Promising much–needed jobs and economic development, the company was welcomed with open arms.
Charlie Arnot: "Our $56 million annual payroll certainly has a dramatic impact. The University of Missouri did an econometric study, when the company was growing very rapidly, and said that the impact was about a billion dollars a year, total, on the state."
P-S-F has made an impact in other areas as well. For most of its history, the company has been entangled in a series of social, environmental and legal problems.
In 1997, Christen and about 60 of his neighbors formed the "Citizens Legal Environmental Action Network", or "C.L.E.A.N". C.L.E.A.N. filed suit against P-S-F, claiming the operation repeatedly violated federal environmental laws.
The suit alleges P-S-F lacked proper air and water permits when it set-up shop in 1989. The plaintiffs claim improper waste disposal from the 100,000 sow operation has polluted streams and fouled the air near their homes.
In 1999, the U.S. Justice Department and the E.P.A. joined C.L.E.A.N. as plaintiffs in the case. The government also announced an investigation into P-S-F's continuing pollution problems.
According to C.L.E.A.N., P-S-F is responsible for more than 100 waste spills in the past seven years.
Charlie Arnot: "One of the challenges that we have is in the way a spill is defined. If you have effluent leaving the system, that is contained in your prevention mechanisms, and is then pumped back into the lagoon, or land applied at an agronomic rate, in our opinion, that shouldn't be classified as a spill."
In August of 1999, P-S-F reached an agreement with the State of Missouri in a separate lawsuit. The company was fined 650-thousand dollars and ordered to invest 25-million dollars in "next generation" waste management technology over the next five years.
The first signs of improvements can be seen at P-S-F's Whitetail facility near Unionville.
Permeable, floating covers have been installed on lagoons and airdams have been added to barns at a cost of more than a million dollars.
Terry Spence raises cattle near Unionville, and serves as the president of C.L.E.A.N. He's skeptical that lagoon covers and airdams will clear the air in his neighborhood.
Terry Spence: "Well so far, I haven't seen any change. Uh, since their buildings was built in 1995, in the area that I live, in Putnam County. I have seen not one difference, if anything since the air dams was put up mostly in the fall of 1998 at Whitetail, and the lagoon covers was put on just here, this Spring, recently, and uh, the odor has been unbearable."
Rolf Christen: "John, I'm going to be very blunt. I will measure their success at my house. And so far, my house it stinks as bad as it always has and with all the investment, nothing has changed for me and as long as that doesn't happen, we will be in court."
In April of 2000, the E-P-A amended its joint complaint with C.L.E.A.N. to include potentially thousands of violations of the Clean Water Act.
The expanded complaint also addresses ongoing pollution at the P-S-F processing facility in Milan.
The government also issued P-S-F a notice of violation of the Clean Air Act, alleging the company emits tons of potentially hazardous pollutants from its hundreds of barns and lagoons.
But P-S-F claims, the amended complaint is redundant and that the violations were satisfied in its consent decree with the State of Missouri. Arnot claims P-S-F is being singled-out by this kind of regulatory scrutiny.
Charlie Arnot: "They withdrew their initial complaint and substituted a new complaint. That's not terribly uncommon, in litigation, for an amended complaint to be filed. What is uncommon, is for an amended complaint to be filed 3 years into the process. Uh, as far as we're concerned, it's too little, too late and it demonstrates to us that they're really fishing, to try and find complaints or points of their case that may have merit."
Since the C.L.E.A.N. suit is filed under citizen provisions of the Clean Air and Water Acts, the plaintiffs are not allowed to receive financial damages.
But Spence claims regardless of the outcome, there will be no winners in northern Missouri.
Terry Spence: "The end result that our community, where I live, has been destroyed forever. It's split our community horribly, I think."
John Nichols: "Charlie, in the last 7 years, P-S-F has declared bankruptcy, has been blamed for more than 100 waste spills, has been sued by citizens groups, the State of Missouri, the EPA, the Justice Department. The company has been fined and forced to spend 25 million on new technology. Are you a good neighbor?"
Charlie Arnot: "I think we are. I think we're a very good neighbor. I think what that demonstrates is that we're on the leading edge of a lot of different changes. We're on the leading edge of some change in structure in agriculture, we're on the leading edge of changing technology implementation in environmental applications, as it relates to agriculture, and we're on the leading edge of an industry that currently, is in the public spotlight and is under a lot of scrutiny of what it has done and how it will continue to operate in the future. But, I do believe, and I think that the majority of residents in the communities where we operate would tell you today, that they do view Premium Standard Farms as a very good neighbor."
Rolf Christen: "No they're not. Anybody that pollutes the air around my house, anybody that pollutes the streams around my farm, is not a good neighbor. No. A good neighbor is somebody who I can go up to, talk about the issue, and then find a quick solution to the issue. I'm waiting, for 7 years now, for a solution and it hasn't gotten any better yet."