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Farmers Union Wants to Buy Aberdeen Beef Plant

South Dakota Farmers Union applauded the opening of the EB-5-funded Northern Beef Packers back in 2012, when the project was churning out more mystery money than munchable meat. Eight years later, after the plant’s gross mismanagement and 2013 bankruptcy, the EB-5 scandal that landed its kingpin in court and the state’s former EB-5 point man in a shelterbelt with a shotgun hole in his abdomen, and the plant’s pennies-on-the-dollar purchase and reopening as Demkota Ranch Beef, Farmers Union wants to buy the Aberdeen slaughterhouse from San Francisco-based White Oak Global Advisors:

The South Dakota Farmers Union is in conversations with its counterparts in Minnesota, North Dakota and Montana and is looking to join with beef and dairy cattle groups in the region to make an offer on the plant, the organization’s President Doug Sombke said Friday.

…“The whole point would be to have things that we control right here in South Dakota,” Sombke said. “It helps farmers and ranchers be owners.”

…Acquiring the DemKota plant wouldn’t be the Farmers Union’s first involvement in the meat packing industry. The South Dakota group is also a partner owner of Redwood Farms Meat Processors, a small pork processing plant in Estherville, Iowa.

The organization is still looking for capital to buy the Aberdeen plant, but if successful, it would only be the start of longer-term effort to create more packing options for farmers, Sombke said [Patrick Anderson, “Farmers Union Looking for Partners to Help Buy Demokota Beef Plant in Aberdeen,” Farm Forum, 2020.05.12].

White Oak is mum so far, but you can bet they’ll look to turn a hefty profit on their investment. They spent $4.8 million to cash on top of several more million in lifeline loans to NBP to acquire the facility, which our EB-5 friends spent $152 million to build. They’ve surely invested millions to renovate the poorly constructed plant and bring production up to speed. White Oak will likely expect Farmers Union to give them a double or triple return on their original investment to acquire a potentially vital piece of American food production infrastructure.


  1. leslie 2020-05-13 07:15

    Rachel Maddow publicized Mike Rounds’s deflection of his EB5 involvement during his US Senate campaign. She is now concerned that SD is involved with CDC investigation reporting manipulation of Smithfield packing on April 22 and JVC packing on April 20 in Greeley. Should be illuminating what GOP/Trump skeletons turn up.

  2. David Newquist 2020-05-13 09:19

    The Farmers Union has long had an involvement in the beef packing plant development as it could provide a market for regional farmers. It provided money and promotion to the original scheme with Ridgeway Farms. before the EB-5 scandal came to light:

    “In November 2005, Ridgeway moved its headquarters out of Huron to Flandreau. It had financial support from the Farmers Union, the Flandreau city council, and the Flandreau economic development organization. But during the early part of 2006, Ridgefield Farms went silent on the progress of its plans, and in August of that year 75 of its investors voted to have all its assets in Flandreau turned over to Farmers Union Industries, which shortly thereafter won a judgment for $1 million from Ridgeway and then filed a lawsuit to recover $3 million it and others had invested in the project.”

    Demkota might be a safer investment.

  3. Donald Pay 2020-05-13 09:43

    I recall from back when I was in South Dakota in the early 2000s, Farmers Union was behind the predecessor push for a packing plant, similar to Northern Beef, in Aberdeen. I think it’s a long-term dream of Farmers Union to untether from corporate control of animal ag. I hope they succeed.

  4. Debbo 2020-05-13 20:36

    Farmers Union would be the safest bet for farmers. I hope this deal works out.

    Leslie, it would be fun and fitting to watch Roundy hung out to dry. 😆

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