If U.S. regulators approve Chinese plans to purchase America's Smithfield Foods—the world's biggest pork producer—the United States risks losing its multibillion-dollar pork industry to China, Senate Agriculture Chairwoman Debbie Stabenow, D-Mich., told CNBC on Wednesday.
"We have a real potential in terms of losing this industry, I think, and its market share in the long run … they have more hog production and then they take over in terms of exports around the world," said Stabenow, noting China has five times more hog production capacity than the United States.
"Our largest export market is Japan. China is right next door. We're very export dependent in this industry, in the pork industry. What happens long term? Even though it looks like a good deal now, do we lose those export markets and potentially lose a tremendous amount of market share."
On Wednesday, U.S. senators, including Stabenow and Grassley, questioned Smithfield's chief executive about food safety and foreign ownership.
To Stabenow, the proposed $4.7 billion purchase by Shuanghui International, the largest acquisition ever of a U.S. company by a Chinese concern, likely aims to fix the country's long-standing problems with food safety, as well.
"Shuanghui is paying a premium of about 30 percent above what would be the market value to buy [Smithfield]. We think it's because they want the 20 years of food efficiency and food safety information and so on to be able to bring their systems up" to date, Stabenow said on CNBC's "Squawk on the Street."
"We, as a federal government, you and I as taxpayers, have put in over $800 million in research and development as it relates to food safety and feed processes and efficiencies and so on and essentially, we have a Chinese company buying that. They are buying it on a premium because they're behind us. They want all of our efficiencies, in part, paid for by federal taxpayers. They're 20 years behind us. So they get up to speed."