The truth about swine

Friday, February 27, 2015

Fallacies have surrounded the swine industry for several years due to a decline in production, but the time has come to learn the truth of the ever important industry.

A modern trend in the U.S. swine industry has been the rapid shift to fewer and larger operations, associated with technological change and evolving industry structure. According to the USDA's website, "the United States is the world's third largest producer and consumer of pork and pork products. It is also the world's largest exporter of pork and pork products, with exports averaging over 20 percent of commercial pork production in most years. U.S. hog operations today tend to be heavily concentrated in the Midwest and in eastern North Carolina."

Due to the decline in the swine industry, the National Pork Board set out to create awareness, and promote the importance of swine through the Pork Checkoff Program. The Pork Checkoff Program sets out to unite pork producers with stakeholders focused on building a bright future for the pork industry through research, promotion and education. To do this, the program collects its funds from U.S. pork producers and importers who pay 40 cents per $100 of value when pigs are sold and when pigs or pork products are brought into the United States.

The National Pork Board attempts to create awareness through the Pork Checkoff Program with the knowledge that swine production is a significant component of agriculture and an essential part of the everyday diet. Pork is the product of swine production, and is a food seen in almost every household. Pork is the most widely consumed meat in the world -- people consume various pork products, such as bacon, sausage, pork chops and ham.

Meat is not the only reason swine are important, however. Several valuable products or byproducts come from hogs. These include insulin for the regulation of diabetes, valves for human heart surgery, suede for shoes and clothing, and gelatin for many food and nonfood uses. Swine byproducts are also important parts of water filters, insulation, rubber, antifreeze, certain plastics, floor waxes, crayons, chalk, adhesives and fertilizer.

The swine industry, as any other industry, is a supply and demand system. Unfortunately, the supply of pork is not nearly as high as the demand, with fewer than 69,100 farms producing pork in the U.S. Operations with 2,000 or more head accounted for 87 percent of the inventory, according to a USDA annual report on Farms, Land in Farms and Livestock Operations. A hog and pig operation is defined as any place having one or more hog or pig on hand by Dec. 31. "Those operations with 2,000 or more swine totaled 8,800. Operations with 1,000 to 1,999 animals totaled 3,400," according to the USDA website. These numbers reflect the priority of creating awareness, and expanding swine production as an essential component for success in the industry.

As far as the market is concerned, the USDA Economic Research Service found that "the all items Consumer Price Index (CPI), a measure of economy-wide inflation, fell 0.6 percent from November to December and is 0.8 percent above the December 2013 level. The CPI for all food increased 0.3 percent from November to December and is now 3.4 percent above the December 2013 level." ERS also predicts that in 2015 "supermarket (food-at-home) prices will see normal to slightly lower than average food price inflation, increasing 2.0 to 3.0 percent. Meat prices will likely continue to experience the effects of the Texas/Oklahoma drought and Porcine Epidemic Diarrhea virus (PEDv)...."

On a smaller scale, pork prices fell again in December, decreasing 1.7 percent from the previous month. However, pork prices are now up 8.2 percent from last year. Retail pork inflation is largely due to the effects of PEDv, which has reduced the fall number of hogs ready for production. However, according to the USDA, " there are some signs of industry expansion as the effects of PEDv have been subsiding." Hog prices in 2015 are expected to fall 17.8 percent below 2014 figures. ERS predicts pork prices to rise 2.0 to 3.0 percent in 2015.

Contact Ashton Clark at aclark@marshallnews.com