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Pork Producers

Officials optimistic about future of pork industry

Oct 05, 2017

By Brooks Taylor, Mt. Pleasant News


It keeps getting better. That is Ron Birkenholz’s view of the swine industry in Iowa.

“Producers keep getting better and genetics keep improving,” Birkenholz, communications director of the Iowa Pork Producers, said.

Birkenholz based his statement on the fact that although sows and gilts are marginally decreasing in the state, total inventory is up.

As of Sept. 1, Iowa pork producers had a total of 22.9 M hogs, up 3 percent from Sept. 1, 2016. Sow and gilt numbers were at 520,000, a drop of 10,000 from the previous quarter, he noted. Meanwhile, U.S. breeding inventory is up a percentage point over last year.

Litter numbers are constantly increasing, Birkenholz noted. He said the latest statistics show an average of 11.2 pigs per litter.

“Producers are definitely in an expansion mode,” he assessed. “The producers are expecting a downturn soon in checkoff dollars which look to remain flat over the next several years. That is one of the big reasons they are ramping up production.”

Checkoff dollars are used by the pork industry for programs and promotion. Forty cents of every hundred dollars the hog sells for goes to the checkoff. Aiding the checkoff, Birkenholz pointed out, is that hogs are being marketed at heavier weights. Today, most swine goes to market at 300 pounds, as opposed to 270 pounds in the past.

Iowa State University Extension Region 5 Swine Specialist Colin Johnson said that profits have been there for producers in 2017.

“Prices have been surprisingly better than what were expected due to the supply on hand of pork,” Johnson stated. “There have been profits for most of the year. There will be some losses this fall,” Johnson continued, “which is always the case due to spring and summer production and the grilling season winding down.”

Johnson and Birkenholz agreed that exports are the major profit card for producers. “Exports definitely are the key,” said Johnson, “and they have been great.”

“Exports are so important to the industry, especially in Iowa,” agreed Birkenholz, remarking that Iowa is the leading pork exporter in the United States with over $1 billion in exports in 2016.

Birkenholz said lower feed costs also contributed to producer profitability in the first two quarters of the year.

Johnson and Birkenholz are both optimistic about the industry in the short term. “I’m optimistic,” Johnson said. “Pork is the number-one consumed food in the world. There are a couple of new packing plants opening in Iowa and that means we can harvest 10-15 percent more pigs.

“I think prices will remain good,” Johnson added. “I anticipate more growth in the industry and Iowa is the place to do it.”

Iowa’s inventory expansion rate is about 1-2 percent per year, Birkenholz stated. “Pork is a big and important industry and producers want to continue to do business. I think they (producers) will be here for a long time.”

“We’re always looking for better ways to raise swine,” Birkenholz said. “The industry has been under attack for many years because of the odor. There is also complaints about the matrix (rules and regulations for building confinement buildings). I think the matrix works fine and forces the producer to go above and beyond current regulations.”

Both men are concerned about the future of NAFTA and other trade treaties under the Trump administration. “The future profitability is very dependent on NAFTA and other trade treaties,” Johnson said. “The future of NAFTA and other trade treaties have producers worried,” Birkenholz said.

Other factors which could influence the short-term future of the industry are disease and weather.

“I’m definitely optimistic about the future. The activity and growth level are there,” sized-up Johnson.

Meanwhile, Birkenholz was more blunt in his assessment of the future, saying, “You have to make hay while the sun is shining.”


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