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Potential litigation due to lien claims sours deal to sell birds.
October 28, 2024
The Iowa Department of Agriculture and Land Stewardship (IDALS) announced Friday that after several failed attempts to secure an offer or alternative option for the 1.3 million broilers involved in the Pure Prairie Poultry debacle, it had received court approval to depopulate them.
In early October, IDALS took over the care, custody, and control of the birds located within Iowa after Pure Prairie Poultry said it no longer had the financial resources to care for the birds. Pure Prairie Poultry also ceased operations at its Charles City processing plant and laid off its workers. With no processor readily available for the birds, IDALS actively pursued numerous other processors and markets, and solicited offers for the purchase of the birds. However, due to the structure of the broiler industry, large-scale processors have limited ability to increase their processing capacity utilizing the open market.
IDALS did secure an initial offer from Tyson Foods to purchase all 1.3 million birds and had a tentative agreement in place for all birds to be processed as they reached market weight, pending court approval. Interested parties were informed of the potential agreement, but on October 7, the day before the scheduled hearing, attorneys for some of the other interested parties notified IDALS that they would assert their lien rights and security interests in the chickens, including against the buyer’s proceeds from the sale of the post-processed meat.
“Citing costs surrounding potential litigation due to the lien claims, the buyer backed away from their offer,” IDALS stated.
During the hearing on October 8, the parties agreed to allow additional time to find a resolution for the birds, with the court continuing the hearing to October 11.
In the interim, IDALS pursued other potential buyers and processors, and even explored whether the broilers could be processed and donated to help Iowans facing food insecurity. However, because of the continuing lien and claim risks combined with the timeliness, logistics and scale required, the department was unable to find a processor available. After exhaustive efforts, no credible offers or proposals materialized, IDALS said.
The court reconvened the hearing on October 11, IDALS, nor the other parties involved, were able to provide the court with any offers for the birds.
“Given the unavailability of buyers and lack of processing capacity combined with the ever-increasing feed and yardage costs, as well as the taxing of department staff resources managing broilers with no end-market, the court granted the department authorization to begin depopulation,” IDALS said.
The court required the department to begin the depopulation process with the largest and least marketable birds in the unlikely event that a credible last-minute market solution could be found for some of the younger broilers. IDALS said that though it believes depopulation should always be a last resort, “it provides finality to this unfortunate circumstance, limits the ever-increasing costs to the taxpayers of Iowa and prevents any potential animal welfare issues.”
In accordance with the court order, depopulation commenced on October 17, utilizing humane methods and guidelines approved by the American Veterinary Medical Association (AVMA). The depopulation was overseen by licensed veterinarians employed by the Department. Depopulation of all Pure Prairie Poultry birds located at Iowa farms concluded on Friday, October 25.
IDALS said it will pursue all available avenues to recoup taxpayer costs from responsible parties, including through possible future legal remedies.
"This is an incredibly unfortunate situation and raises serious questions about USDA's oversight of taxpayer dollars. Congress should exercise its oversight authority to ensure that something like this does not happen again and that those responsible are held accountable,” stated Iowa Secretary of Agriculture Mike Naig.
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