By TIM ALEXANDER
Illinois Correspondent

RANTOUL, Ill. — Owing up to $6 million to around 100 Midwestern farmers and shareholders, Meadowbrook Farms, which ceased operations at its state-of-the-art Rantoul hog processing plant earlier this year, is expected to file for bankruptcy at press time.
According to the Associated Press (AP), Belleville-based Meadowbrook’s board of directors voted earlier this month to file for Chapter 7 bankruptcy protection. Bob Johnson, a hog farmer and Meadowbrook board member, said he expected the bankruptcy papers to be filed soon, though there is a slim hope the company can locate an investor or lender to bail it out.

“We’ve had feelers out to what you might call white knights,” Johnson, of DeKalb, told the AP. “I don’t think it’s likely at this point.”

Meadowbrook quit paying its co-op member-farmers late last year, with many producers claiming they had been underpaid by as much as $20 per head for several years by the cooperative.

Meadowbrook president and CEO Rick Klene said proceeds from the liquidation would be used to pay as many of the company’s debts as possible, leaving many pork producers who own the co-op and delivered swine to the facility wondering if they’ll be paid at all.
A phone call and subsequent e-mail to Jay Johnson, regional director of the USDA’s Grain, Inspection, Packers & Stockyards Administration (GIPSA) inquiring how Chapter 7 protection for Meadowbrook would affect farmers who filed bond and trust claims with GIPSA was not returned by press time.

The $24 million facility, opened in 2004 with $1.6 million of Illinois taxpayers’ money, is being actively marketed to other pork processors, according to Rantoul’s economic development director, Robert Bruce.

“The real killer is the jobs,” said Bruce, adding that no prospective buyers for the plant had surfaced as of March 10. “Relocating here would be an upgrade for most pork-processing companies.”
The plant employed around 625 area residents.

Johnson, Klene and other co-op officials pin Meadowbrook’s collapse on Chicago-based Triad Foods, saying the company reneged on a contract with Meadowbrook to provide antibiotic-free pigs. Triad Foods denies the allegation, accusing Meadowbrook of failing to live up to the terms of the contract.

Meadowbrook had been victimizing its producer-members for many years, according to Keith Bolin, American Corn Growers Assoc. president, who posted an article (Clift et al v. Meadowbrook Farms Cooperative) detailing company officials’ alleged mishandling of Meadowbrook’s assets on the ACGA’s website in July of 2007.