Agriprocessors facts for kids

Agriprocessors plant in Postville, Iowa

Agriprocessors was the corporate identity of a slaughterhouse and meat-packaging factory based in Postville, Iowa, best known as a facility for the glatt kosher processing of cattle, as well as chicken, turkey, duck, and lamb. Agriprocessors' meat and poultry products were marketed under the brand Iowa Best Beef. Its kosher products were marketed under various labels, including Aaron’s Best, Shor Habor, Supreme Kosher, and Rubashkins.

The firm was founded and owned by Aaron Rubashkin, who purchased the meat-packing facility in 1987, and managed by two of his sons, Sholom Rubashkin and Heshy Rubashkin. Eventually it became the largest kosher meat-packing plant in the United States.

Agriprocessors faced accusations of mistreatment of cattle, pollution, and a series of alleged violations of labor law. In May 2008, the U.S. Immigration and Customs Enforcement (ICE) staged a raid of the plant, and arrested nearly 400 illegal immigrant workers. Agriprocessors plants stopped operating in October 2008, and the firm filed for bankruptcy on November 5 of the same year. Sholom Rubashkin as the highest ranking day-to-day corporate officer was charged with federal financial fraud and sentenced to 27 years in prison in June 2010, and was let free after U.S. President Donald Trump commuted his prison sentence on December 20, 2017.

The Agriprocessors plant was bought at auction in July 2009 by SHF Industries and has resumed production under the new name Agri Star.

History

In the 1980s Aaron Rubashkin, a Russian-born Lubavitcher Hasidic butcher from Brooklyn, decided to take advantage of economic structural changes to bring mass-production to the kosher meat production business. In 1987 he bought an abandoned slaughterhouse outside Postville, a town undergoing a major employment crisis in northeastern Iowa and opened a processing plant creating some 350 jobs. He sent two of his sons to Postville to oversee day-to-day operations. Sholom Rubashkin, the second youngest, served as CEO, and Heshy Rubashkin, the youngest, as vice president of marketing and sales. In 1992, Agriprocessors added poultry to its offerings. At its peak the plant employed over 800 people, slaughtering more than 500 head of cattle each day in kosher production. The sales, according to numbers given to Cattle Buyers Weekly, rose from $80 million in 1997 to $180 million in 2002 and may have reached $250 million or more.

Rubashkin brought modern industrial methods to what has historically been a small, almost boutique craft, developing retail-ready glatt kosher products being sold both in supermarkets and in small, local grocery stores and meat markets around the United States. Agriprocessors was the largest (glatt) kosher meat producer in the United States and the only one authorized by Israel's Orthodox rabbinate to export beef to Israel.

In the 20 years it operated in Postville, Agriprocessors had a major impact on the town, creating new jobs, attracting immigrants from many different countries, and bringing an influx of Orthodox Jews to a part of the United States where Jews had been practically unknown.

The Rubashkin family opened another processing plant for bison, cattle and lamb called Local Pride Plant in conjunction with the Oglala Lakota native-American tribe of the Pine Ridge Indian Reservation in Gordon, Nebraska in 2006 employing some 100 locals. The presence of the plant near an Indian reservation provided considerable tax breaks for Rubashkin. Governor Dave Heineman presented a $505,000 gratuity check to Rubashkin on behalf of the city of Gordon, as part of an incentive package that brought the factory to the town.

Agriprocessors had two distribution sites, one in Brooklyn, New York, and one in Miami, Florida, both managed by members of the Rubashkin family. It also operated slaughter facilities in South America.

Bankruptcy

On November 5, 2008 Agriprocessor filed for Chapter 11 bankruptcy. Factors cited included a loss of most of the workforce due to the May 2008 immigration raid, declining demand for the firm's products, and increased costs in the aftermath of the raid. The Associated Press reported that “Agriprocessors in its bankruptcy filing said the company owed $50 million to $100 million to creditors. The move appears to be an effort to pre-empt foreclosure by a St. Louis bank, which sued Agriprocessors for defaulting on a $35 million loan”.

In December, the bankruptcy court approved a $2.5 million loan for Agriprocessors to allow it to resume poultry processing through at least January 9, 2009 (about 750,000 chickens). The company was run by Chapter 11 bankruptcy trustee Joseph E. Sarachek of Triax Capital Advisors.

Agriprocessor's problems led to a shortage of kosher meat and higher prices nationwide. Empire Kosher, the largest US producer of kosher poultry, doubled its production capacity in response.

Agriprocessors was bought at auction in July 2009 by SHF Industries, a company formed by Canadian plastics manufacturer Hershey Friedman, an observant Orthodox Jew, and his son-in-law, Daniel Hirsch. The plant has resumed business under the new name Agri Star Meat & Poultry, LLC.

Media

The town of Postville and Agriprocessors have been widely covered by the media in the US and Israel, particularly since the ICE raid in May 2008, mostly focusing on the Jewish element. Postville and Agriprocessors are also the subject of two books, a play, documentary films and an episode of American Greed.

Postville: A Clash of Cultures in Heartland America by journalist Stephen G. Bloom, was published in 2000, the documentary film Postville: When Cultures Collide based on it was released in 2001. Postville U.S.A.: Surviving Diversity in Small-Town America, written by Mark Grey and Michele Devlin, sociologists at the University of Northern Iowa, together with Aaron Goldsmith, a Lubavitcher Hasid and former member of the Postville City Council, came out in 2009, as well as the documentary film on the ICE-raid abUSed. In the same year, seven men who were arrested in the raid wrote a play in Spanish, la Historia de Nuestras Vida (The Story of Our Lives) and performed it at Lutheran churches in Decorah, IA and Minneapolis.

On March 23, 2011 CNBC's American Greed aired an episode related to this story entitled "The Slaughter House".