Hog market swings up just in time for largest pork producers.
How close was the U.S. swine industry to a total meltdown this year? When the hog market finally swung black in April, many of the Pork Powerhouses® were within weeks of disaster. Bankers were scrambling to restructure loans, producers were putting back-up capital plans in place, and packers were pre-purchasing pigs and providing unsecured loans.
I pulled up my Pork Powerhouses file on Jack DeCoster this morning, since he is making national news due to salmonella contamination in eggs from his Iowa farms. I first heard of DeCoster 16 years ago when I was collecting data for my Pork Powerhouses report, an annual ranking of the largest pork producers in the U.S., published in Successful Farming magazine. At that time, one of my trusted sources in the hog industry told me an egg producer from Maine with a record of environmental violations was buying land in Iowa and planning to build sow farms. “Watch him,” I was told.
For the first time since the annual Pork Powerhouses ranking was launched in 1994, the nation's largest 25 producers have cut sow numbers.
The U.S. pork industry is squeezing down, as one producer calls it. High input costs -- mainly in feed and energy -- have made survival, not profit, the short-term goal for many companies. The 2008 Pork Powerhouses annual ranking shows total U.S. sow numbers.
Some things you can just take to the bank. Sow herd expansion among the Pork Powerhouses would fall into that category -- even in the face of the biggest run-up in feed prices in history.
Sow farms are in the works, but few are farrowing yet. Producers remain cautious.
Top 20 producers add 61,200 new sows last year with more planned.
Productivity is sky-high for the nation’s largest producers; new processing plant hopes to help handle the glut next year.
Bob Christensen and several other Pork Powerhouses, including #10 Hanor and #21 New Fashion Pork, are shareholders in the new packing company Premium Pork, LLC (the name will soon change).