Major Washington pork producer in default

WASHINGTON — One of the top pork producers in one of the top pork-producing counties in America’s number one pork-producing state is in default on over $38.8 million of debt, according to court records.

The company, JWV Pork, is an established four-generation hog farm based in Washington, Iowa, which skyrocketed to major success under the co-ownership of Jerome and Heidi Vittetoe since the early ‘80s.

Heidi Vittetoe, the company’s de facto spokesperson, declined to comment on the matter when contacted Thursday.

Legal documents filed with the Iowa District Court in Linn County this month said the company failed to make payments on time for a number of loans from Farm Credit Services originating between 2016 and 2022. Combined, those loans leave a total of $38.8 million of outstanding indebtedness in default between JWV Pork, JWV Milling, Savanna Pork, Vittetoe Enterprises, and J & H Legacy Farms as of Aug. 10.

The petition asked the court to expedite a hearing for the case, a move the Vittetoes said they did not resist.

“Borrowers’ liquidity is rapidly dwindling, and is projected to imminently fall below critical operational levels,” said an affidavit from the lenders. “As such, (the) lender’s rights, recoveries, and collateral are in danger of being lost, and will be materially prejudiced, injured, and/or impaired unless a receiver is appointed on an emergency basis.”

Collateral for those loans includes all manner of the pork producer’s inventory, goods, accounts, equipment and real estate.

In court documents, lenders said they were entitled to “take immediate possession of the property and all rents, issues, crops, profits, and income” from the long list of collateral in the event of a default. An excerpt from JWV’s contract for the loans included in court records said the business “agrees not to oppose” the appointment of a receiver in the event of a default.

Lenders said JWV had already agreed to a “mandatory mediation agreement” on Aug. 24, in which the company “agreed to cooperate” with efforts to liquidate its collateral assets.

In its answer to the petition, JWV Pork’s owners conceded the list of loans and collateral, as well as the fact that they had not met the payment deadlines. The pork company’s owners said they lacked information to agree or disagree about the lender’s ability to manage the assets and “faithfully discharge the receiver’s duties,” if it takes over company assets.

Linn County’s District Court on Sept. 13 sent the case to the Iowa Business Specialty Court, where District Judge Jeffrey Bert was appointed as the primary judge for proceedings. Bert signed an order the following day saying the case would move forward.

That order named Focus Management Group as the recipient of JWV Pork’s collateral. The Chicago-based company is a financial adviser specializing in “corporate turnaround and restructuring“ efforts according to its website. It bills itself on LinkedIn as a consultant that “provides turnkey support to underperforming companies and their stakeholders.”

The news hits hardest in Washington, where JWV Pork is headquartered and known for its widespread involvement. The business has over 80 employees, is a frequent lead sponsor for events like the Washington Summer Classic and annual Latino Festival, and donates thousands of pounds of food a year to community action programs, food banks, local events and charitable causes.

  Buy Photo

The co-owners themselves are equally civically engaged. Heidi Vittetoe is a former Washington school board member, an established volunteer at St. James Church and an outspoken advocate for employee training and career development initiatives. Jerome Vittetoe is a member of the Washington County Fair Board as well as the county’s eminent domain commission, and a consistent participant in a more recent town tradition, the Retirement Home Tractor Parade.

Their company is also powerhouse of pork production, recognized not only across the state but across the nation.

As of 2019, JWV marketed around 400,000 pigs a year, according to an article at PorkBusiness.com. Heidi Vittetoe told the same outlet in June of this year that her operation had recently reduced its sow herd by 10%, however, citing unsustainably high feed costs.

Such concerns are widespread. The National Pork Producers Council said they were shared across the industry, reporting that break-even levels for pork production were up 9% since last year and had increased 60% in the last three years.

“This year, hog producers are losing an average of $40 per head on each hog marketed,” the organization said in its newsletter for the bimonthly Iowa Pork Producer Magazine in September. “While hog prices have moderated significantly since 2022, current losses are largely because of record-high production costs that have increased up to 50 percent over the past year, and those losses could force some producers to exit the industry.”

Comments: Kalen.McCain@southeastiowaunion.com