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Convert to Pens Smithfield Urges Sow Growers

Acknowledging the challenge it is setting forth, Smithfield Foods, Inc. and its hog production subsidiary, Murphy-Brown LLC, announced today that it is recommending all of its contract sow growers join with the company in converting their facilities to group housing systems for pregnant sows. The company said that it is asking contract sow growers to convert by 2022 with a sliding scale of incentives to accelerate that timetable. Growers who commit to convert to group housing will receive contract extensions upon completion of the conversion.

At the same time, Smithfield Foods reported that Murphy-Brown had, through the end of 2013, transitioned 54% of pregnant sows on its company-owned farms in the United States to group housing systems.

The announcement supports the company's industry-leading effort that began in 2007 when it was the first major pork supplier to commit to transitioning to group housing systems on company-owned farms. “More and more food companies are looking to suppliers to move toward group housing systems for pregnant sows,” said Dennis H. Treacy, executive vice president and chief sustainability officer of Smithfield Foods.

“To date, more than 50 companies--many of them Smithfield customers--have announced that they will source pork in the future from suppliers utilizing group housing,” he said.

Treacy added, “In line with our animal care initiatives and sustainability goals, and in order to meet the needs of our customers, we believe that it is now time to encourage conversion of pregnant sow housing systems at contract sow grower facilities. In fact, several growers have already converted or have made plans for the change.”

Smithfield notified their contract sow growers nationwide of this recommendation last month.

Treacy emphasized that although the conversion of contract sow growers' facilities to group housing systems is being encouraged, it is not mandatory. If growers choose not to participate, their current contracts with Murphy-Brown will remain unchanged, although extensions are less likely.

C. Larry Pope, president and chief executive officer of Smithfield Foods, understands fully what the company is asking of its contract sow growers.

“We recognize that these projects require a significant investment on the part of our growers,” Pope said. “But a well-planned renovation to a group housing system will help maintain the farms' value for years to come, while at the same time supporting our companywide commitment to
animal care.”

In 2007, Smithfield made a business decision based on input from its customers to convert to group housing for pregnant sows on all company-owned U.S. farms. Smithfield remains on track to finish its conversion to group housing systems on all company-owned U.S. farms by 2017. Smithfield's international hog production operations will complete their conversions from gestation stalls to group housing systems on company-owned farms by 2022. Smithfield's hog production operations in Poland (AgriPlus) and Romania (Smithfield Ferme) completed their conversions to group housing facilities a number of years ago.



A New Year’s List of Economic Issues Impacting the Pork Industry

A New Year’s List of Economic Issues Impacting the Pork Industry

Happy New Year!  As 2014 dawns with a brutal cold rush, it is time to look at the economic issues that will be key to producers’ success this year and beyond.

The 2014 crop“It’s baaaaaa---aaaack!”  Actually, the issue of crop size has never left us since the dawn of the biofuel era.  Last year’s record corn crop and near-record soybean crop have reduced the cost pressure on feed users but just how long will that last?  The answer is, “Not too long if the 2014 crop isn’t another good one!”  The EPA’s 2014 Renewable Fuel Standard (RFS) will require blenders to use roughly 13.5 billion gallons of corn-based ethanol.  That decision puts less pressure on the corn supply than we have seen since 2004.  In addition, other countries now produce about 50% more corn than they did in 2004 before the original energy law and the original RFS was set. 

The corn supply has pretty much caught up with usage when corn is priced in the range of $4.00 to $5.50 per bushel.  But total domestic usage and exports will now exceed 13 billion bushels any time we do not have a short crop.  Corn acres will almost certainly be lower in 2014 due to high soybean prices.  A harvested acres figure of 85 million bushels (versus 87.2 in 2013) and a trend yield of 162.1 bushels per acre would put the crop at 13.770 billion bushels, down 220 million from last year.  Shave 10% off the yield, though, and you get 12.401 billion bushels and will very likely push carryout stocks back below one billion bushels and get corn prices in the $6.00 to $7.00 range.  Feed supply, demand and cost are all better but still leave pork producers on the precipice of high costs.

Pork – and meat – demand.  This is on the list every year, of course, but we begin this year with more positive momentum since the early ‘00s.  As can be seen in Figure 1, real per capita expenditures on the four major animal protein species were higher in October than in any month since 2005 except for September 2007.  I think 2013 will be the best year for consumer spending on meat and poultry since 2005 when the November and December figures are all available in early February.

I think we need to consider the Atkins Diet years of 2004-2006 somewhat as “outliers” in Figure 1.  While I am living proof that the concepts of the Atkins Diet are sound and will work to reduce weight and improve cardiovascular health, it was a bit of a craze that may constitute what amounts to anomalous readings for meat and poultry demand in those years.  Remove those high observations and the chart looks far more continuous with the lows of 2009 and early 2010 driven largely by the Great Recession’s huge negative impact on the restaurant sector and a “trading down” impact on consumers’ choices at retail. 

Per capita consumption of pork and broilers GREW by 1.8% and 1.6%, respectively in 2013, while it remained steady for turkey and fell by 1.8% for beef.  But the expenditure driver is price.  Strong demand has been revealed by consumers’ willingness to pay record-high prices.  Will that continue in 2014?

Exports Always an issue now that they represent nearly one-quarter of U.S. pork production and an even higher percentage of U.S.-Canadian output.  Russia is still not taking U.S. pork and there appears to be no change in sight for that stance.  Year-on-year comparisons for China-Hong Kong will look much better this year since we will be comparing to “normal” shipments which continue to trend upward very nicely. 

There are two big risks.  First, there is the ever-present danger of an export-blocking disease outbreak.   Porcine epidemic diarrhea virus (PEDV) is proof that it could happen and is also proof that we may not be able to handle a more serious disease outbreak.  I say “may” there only because PEDV, as a “non-reportable” disease, did not trigger all of the possible interventions available to federal and state regulators that foot and mouth disease, African swine fever or classical swine fever would trigger.  Would the additional actions make a difference?  I hope so but . . .  

The second issue is, of course, what happens with the mandatory country of origin labeling (MCOOL) situation.  We should know the World Trade Organization’s (WTO) take on the new US rule this spring.  If they say it is sufficient (which I do NOT expect!), the program will stand and exert negative impacts on Canadian hog and cattle producers and Mexican cattlemen.  If they agree with me and find the rule change insufficient, then the ball will be in the Congress’s court once again.  We hear of a “fix” in the U.S. farm bill but have not seen the specifics.  I find it very hard to believe that a country-of-origin labelling program that is not based on the long-sufficient idea of substantial transformation can meet trade commitments.

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Hog numbers.  This is always a factor, of course, but it is an obvious issue for 2014 given PEDV losses and the counter-intuitive figure for the U.S. breeding herd in the December Hogs and Pigs report.  It appears now that 2014 annual slaughter will be roughly even with that of 2013. And, I think the estimates will get smaller as the true extent of PEDV losses becomes known.  Higher weights will add to production and likely leave total U.S. output larger than last year – but not by much.  Export and population growth will leave per capita availability lower by 1-2%, implying a continuation of strong hog prices.

In closing, I want to relate an experience from last week.  My family and I attended the Rose Parade last week.  Beautiful floats, terrific bands, lovely weather and 700,000 of our now-closest friends all added up to a great time. If it is not on your “bucket list”, add it now!  But the takeaway was this:  There were two floats – which cost, from what I can gather, anywhere from $100,000 to $250,000 even though they utilize a lot of volunteer help – from pet rescue groups.  They were cute and impressive and, to me, indicate just how much money these people have to throw at positive PR.  Add that to the Sea World float surrounded by sheriff’s deputies and policemen in riot gear after a protest from an animal rights group and you have somewhat of a theme that we in the livestock business know all too well.  And another issue for 2014 and beyond.

But I firmly believe that happiness is a choice.  The Apostle Paul wrote that he was content in any circumstance.  Regardless of what 2014 brings, may it be so for you this year!

NOTE:  Canadian supply and prices in today’s tables represent 12/14 and 12/21.


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SMS Database Revision Reveals Intriguing Production Trends

As we start the New Year we are excited about the changes that have been made to the Swine Management Services, LLC (SMS) database used for farm benchmarking. The last few months SMS has been updating the format for the Farm Benchmarking report. To get the additional parity information that was needed going forward, the database was cleaned out and reloaded with more detailed data from the cooperating farms. The rebuilt database is now at 630 farms that have a female inventory of 1,193,547 sows. Farms are from the United States, Canada, and China. The more detailed information contained in the Farm Benchmarking database allows us to analyze and share even more production data with Weekly Preview readers.

Readers will note that Table 1 SMS Farm Benchmarking presents summary data in a new layout. The breakdown is now 90-100th percentile (top 10%), 70-90th percentile (next 20%), 50-70th percentile (next 20%), 30-50th percentile (next 20%), 0-30th percentile (bottom 30% of farm) and an “All” average for the last 52 weeks. Readers can also see a 13-week, 26-week, and 12- quarter average for all farms. The report shows how many farms and sows make up each percentile. Along with the SMS Production Index, which is made up of 11 production numbers, there is a line that shows the Potential for Improvement in Pigs Weaned / Mated Female / Year. The typical production numbers of Pigs Weaned / Mated Female /Year, Total Born / Mated Female / Year, Piglet Survival Percentage, Litters / Mated Female / Year, Wean to First Service Interval days, Farrowing Rate Percentage, and Female Death Loss Percentage are shown.

We have added three new production numbers to be used to compare farms: Gilt Farrowing Rate Percentage, Total Pigs Born / Female Farrowed (P1 + P2 + P3), and Retention Percentage (100 – P1 – P2 – P3 cull and death loss). These numbers we see as drivers to improving pigs weaned / mated female / year. This chart will be updated every month in the articles we write.

More detailed data being collected for each farm means that we can create more charts and tables. The production data will be presented in a figure that combines a chart showing the trend lines and a data table that was used to create the chart.

Production trends

We have created five figures showing production trends for this article. The data used was from the 630 farms in the database, broken out by the last 12 quarters, with the ending date of September 29, 2013.

Figure 1, “Pigs Weaned / Mated Female / Year,” shows the last 12 quarters (3 years) and illustrates the improvement for “All Farms” from 23.61 pigs to 25.64 pigs, which was an improvement of 1.59 pigs.

The bottom 30% of farms (70-100%) consisted of 189 farms which improved by 2.85 pigs, from 19.21 to 21.75 pigs. The 63 farms making up the top 10% (0-10%) went from 28.51 to 30.97 pigs, which means a gain of 2.03 pigs. This was an improvement of 7.1% and equals .17 pigs per quarter. Also note that in Q12 the 0-10% farms were at 30.97 pigs. The 70-100% (bottom 30%) were at 21.75 pigs, which was a difference of 9.22 pigs weaned / mated female / year.

Producers can see the real production potential for farms by looking at Figure 2, “Total Born / Mated Female / Year.” During the last 12 quarters, all farms have gone from 30.14 to 33.04 pigs, which is 2.25 more pigs. This shows the continued genetic improvement going on in the industry. The 70-100% group improved the most, going up by 4.58 pigs versus the 0-10% at 1.04 pigs. The blue line shows that the genetic improvement for the top farms for total pgs born is slowing down or peaking. The bottom 30% farms (70-100%) are continuing to show more improvement (refer to the red line). Please note that there is still seasonal variation in production which affects the farms in the bottom 30% more than the top farms.











Figure 3, “Piglet Survival” (figured using the formula: 100 – stillborns % - pre-weaning mortality %) evaluated how well pigs are managed in the farrowing rooms. This equation was created a few years ago to adjust for how dead pigs were classified as either a stillborn or death in farrowing. During the last 12 quarters, the “All farms” category has shown an average of 79.0%, with a drop of 0.9% during this time.

As the figure shows, the 0-10% (Top 10%) improved by 1.9% from 83.2% to 85.2%. If you look at the table and chart you will see that most of that improvement took place during the last four quarters. We feel that these farms had peaked out in total pigs born and to get more pigs weaned have improved Day One pig care, and in many cases, extended the hours someone is attending sows farrowing in order to lower stillborns and reduce chilling of pigs after birth. The 70-100% group showed a drop of 3.2% over the course of the last 12 quarters. This group of producers have not made changes to management in farrowing to take advantage of the extra pigs being born.

Figure 4, “ Stillborn %,” and Figure 5, “Pre-weaning Mortality %,” are the two components of Piglet Survival. The Stillborn % trend line (Figure 4) for the last 12 quarters has been down with an improvement of 0.42%. The 0-10% farms are leading the way with a drop of 0.81% during the last 12 quarters, with Q10 to Q12 dropping to just over 5% stillborns.


In Figure 5 there has been an increase in the Pre-weaning Mortality % of 1.32% during the last 12 quarters from 13.09% to 14.3%. The bottom 30% farms (70-100%) are losing more pigs, with the trend line moving from 14.67% to 19.2% during Q 11, and 17.46% during Q 12 (see red line). Does this jump start to reflect the PEDV going around the country? The 0-10% farms continue to refine Day One pig care and saw a drop of 1.14% in pre-weaning mortality percentage during the last 12 quarters (see the blue line).

At SMS, our mission statement is to provide “Information solutions for the swine industry.” We feel with the creation of the new Farm Benchmarking database we now have more detailed information to share with the swine industry. If your farm would like to be part of the Farm Benchmarking database, or if you have suggestions on production areas to look at, feel free to e-mail or call us. We are looking forward to the year 2014 and being a part of the National Hog Farmer Weekly Preview team.

Previous Production Preview columns can be found at


SMS Production Index

Table 1 provides the 52-week rolling averages for 11 production numbers represented in the SMS Production Index. The numbers are separated by 90-100%, the 70-90%, the 50-70%, the 30-50% and the 0-30% groups. We also included the 13-week, 26-week and 12-quarter averages. These numbers represent what we feel are the key production numbers to look at to evaluate the farm’s performance.

If you have questions or comments about these columns, or if you have a specific performance measurement that you would like us to write about, please contact: or

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Three Million Pigs Possibly Lost Due to PEDV

Three Million Pigs Possibly Lost Due to PEDV

Three million pigs may have been lost to porcine epidemic diarrhea virus (PEDV) during 2013, according to some estimates, says Bob Thaler, South Dakota State University (SDSU) Extension swine specialist.

 “The first cases were reported this May, and as of Dec. 1, 2013, there are 1,512 cases in 20 states in the United States,” Thaler says. “The disconcerting news is that this is an increase of 140 new locations from the week before, which is the largest one-week jump in cases.”

While South Dakota has only two reported cases, Thaler says multiple cases have been reported in Iowa and Minnesota, with Nebraska reporting its first cases the end of December.

“Outbreaks of PEDV can be devastating. There is 100% mortality in newborn pigs, and this typically creates a five-week hole in pigflow because there are no pigs to wean,”Thaler says. “Pigs in the early nursery phase don't experience the high death loss, but it does cause severe diarrhea so many pigs are stunted and nursery performance suffers.”

As pigs get older and their own immune system becomes functional, Thaler says there is little to no death loss, and most pigs experience just a one-week lag in growth performance.

“One of the good things about PEDV is it appears that the virus itself is not an airborne threat,” he says. “However, it is very easily transmitted by manure and if a virus-contaminated piece of manure were to be small enough to get aerosolized, then PEDV could travel in the air.”


Thaler says preventing infected manure from getting on your farm is the best way to prevent PEDV.

“Unfortunately, PEDV is an extremely infective virus and it only takes a minute amount to cause an outbreak,” he says. “PEDV can live in manure slurry up to 14 days at room temperature, and more than 28 days in cold slurry, so it is not affected by the cold. It can also live in feed up to one week,” he says.

The biggest threat to pork producers is when they take their pigs to market. Packing plants and buying stations are great commingling places for disease.


 Before getting out of the cab, producers need to put on a pair of disposable boots and then get the pigs unloaded. Before getting back into the cab when done, they need to take off and discard the boots immediately before entering the cab.

“Even a small chunk of manure on the floor mat means disaster,” Thaler says.


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 He adds that many producers routinely go to truck washes after unloading hogs to clean out their trailer. While this is a good idea, Thaler reminds hog producers that truck washes are also another commingling place where PEDV is prevalent.

“Any manure that splashes up on the truck, tires, or boots during the cleaning process probably has the PED virus in it. After cleaning the trailer at a truck wash, it needs to be sprayed with a disinfectant and allowed to dry,” he says.

When done properly, drying and disinfecting will take care of both PRRS and PEDV. Thaler also encourages producers to visit with their veterinarian about which disinfectants are the most effective.

 “If a clean and disinfected truck and trailer can be dried at 160 degrees F for 10 minutes, the virus should be gone,” he says. “If they are dried at room temperature, it'll take one week to kill the virus.”

He adds that recent research shows that convenience stores are also a great commingling place for PEDV.   

“In a study in Iowa, the floors of over 50 different convenience stores were swabbed and all tested positive for the PED virus,” he says. “If a person goes into the store for coffee and a roll after selling a load of hogs, they risk picking up the PED virus on their shoes, which then could infect their whole herd at home.”

Therefore, Thaler suggests bypassing the convenience stores if producers plan to visit the unit when they get home - or at least make sure they change shoes before going back into the operation.

While PEDV is a devastating disease for swine operations, Thaler says strict adherence to biosecurity protocols can dramatically decrease the chances of getting it.

“Everybody involved with the operation needs to buy into the program, and that will also reduce the risk of bringing in other diseases like porcine reproductive and respiratory syndrome (PRRS),” he says.

For more information, contact Bob Thaler, SDSU Extension swine specialist, (605) 688-5435; Russ Daly, SDSU Extension veterinarian, (605) 688-5172 or Ashley Gelderman, SDSU Extension swine field specialist, (605) 782-3290.

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Ag Support for TPP on Hold

Seventeen agricultural groups have informed the administration that they will oppose the Trans-Pacific Partnership (TPP) trade agreement if it includes Japan but Japan does not agree to comprehensive trade liberalization, including elimination of tariffs on virtually all U.S. agricultural products. 

In a letter to U.S. Trade Representative Michael Froman, the group said, “In previous negotiations, the United States had demanded and received from developing country trading partners full and comprehensive liberalization in the agricultural sector.  Yet in the TPP negotiations, Japan - a rich, developed country - is demanding special treatment for its agricultural sector.  We consider an agreement that includes such special treatment for Japan to be unacceptable. Giving Japan 'special treatment' would establish a terrible precedence and other countries would seek the same." 

The group said this would also affect future trade agreements, including the Trans-Atlantic Trade and Investment Partnership that is being negotiated between the U.S. and the European Union.  Those signing the letter included the American Farm Bureau Federation, American Meat Institute, American Soybean Association, National Association of Wheat Growers, National Cattlemen’s Beef Association, National Chicken Council, National Corn Growers Association, National Pork Producers Council, North American Meat Association, and U.S. Rice Federation.

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EU Considering Tripling Support for Ag Exports

The European Commission (EC) is proposing tripling its spending on agricultural export promotion programs.  The European Parliament will soon consider increasing European Union (EU) agricultural export promotion programs from $82.5 million in 2013 to $270.5 million in 2020. 


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The EC is planning a slogan, “Enjoy, it’s from Europe,” as part of the expanded promotion program.  The U.S. Meat Export Federation (USMEF) said, “With 96%  of the world’s population living outside our borders, we need to focus our energy and resources on putting U.S. meat and other agricultural products on the world’s tables.  If we don’t, our competitors in the EU and around the world will gladly take that business off our hands.”  The two major U.S. export promotion programs, the Foreign Market Development Program (FMD) and the Market Access Program (MAP), need to be reauthorized in the farm bill.  If Congress fails to pass a farm bill, these vital programs will no longer exist.  

Permanent Meat & Grain Flexibility in School Lunch

USDA announced it is making permanent the current flexibility that allows schools to serve larger portions of lean protein and whole grains in the National School Lunch Program.  USDA implemented the current flexibility in the meat and grain servings in 2012 after it had received criticism from school districts, local governments, and lawmakers over the cost of the new rule and the amount of meat and grains allowed in school lunches.


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The rule as part of the “Healthy Hunger Free-Kids Act” of 2010 still maintains that school meals should remain within recommendations for total calories: 550-650 calories for kindergarten through grade five; 650-700 calories for grades six through eight; and 750-850 calories for grades nine through 12. Last year, Congresswoman Kristi Noem (R-SD) introduced legislation to make permanent the current flexibility in meat and grains in school lunches.  

Chinese Chicken and Schools

A bipartisan group of Congressmen are asking that the U.S. Department of Agriculture (USDA) keep poultry slaughtered in China from being exported to the U.S. and that Chinese-processed chicken be kept out of the U.S. schools.  The members are asking that Congress use the fiscal year 2014 agriculture appropriations legislation to prohibit Chinese-processed chicken from being served in the National School Lunch Program, the School Breakfast Program, the Child and Adult Care Food Program, and the Summer Food Service Program.  Members signing the letter included Congressmen Rosa DeLauro (D-CT), Dana Rohrabacher (R-CA), and Jeff Fortenberry (R-NE). 

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Baucus Nominated Ambassador to China

President Barack Obama is nominating Senator Max Baucus (D-MT) as the U.S. Ambassador to China.  In announcing the nomination, President Obama said, “For more than two decades Max Baucus has worked to deepen the relationship between the United States and China.  The economic agreements he helped forge have created millions of American jobs and added billions of dollars to our economy, and he's perfectly suited to build on that progress in his new role.”  Senator Baucus is chairman of the Senate Finance Committee and a member of the Senate Agriculture Committee.  

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Environmental Stewards Nominations Due March 31, 2014

Environmental Stewards Nominations Due March 31, 2014

Application and nomination forms for the 2014 Environmental Stewards of the Pork Industry awards are now available. Each year, National Hog Farmer magazine and Pork Checkoff co-sponsor this national recognition program to recognize pork producers’ ongoing commitment to protect and enhance the air, water and land in the proximity of their pork production farms.

Nominations are open to pork production operations of all types and sizes. Past award winners have represented family owned and operated farms, contract producers and management teams working within an integrated production system.

Learn more about the 2013 Environmental Stewards of the Pork Industry here.

Now in its 20th year, this recognition program has fostered a greater public awareness and appreciation for pork producers’ commitment to manage their hog operations in harmony with nature and the greater community. Additionally, this program reinforces to the general news media and the nation’s policymakers that pork producers are committed to protecting the environment and our valuable natural resources.

Do you have a friend, neighbor, co-worker or business associate who is doing an exceptional job of managing a hog operation and the rich crop nutrients generated by that production system?

Is he/she tuned into soil and water conservation practices, utilizing management strategies to reduce odor and improve air quality?

Are they sensitive to the needs of wildlife in the area?

Do they present a positive image for pork production in their communities?

These are qualities we are looking for in nominees for the annual Environmental Stewards awards.

Pork producers can apply or be nominated by state pork producer groups, Extension agents, swine veterinarians or other industry-related professionals. A nomination must focus on a single production site, outlining the owner’s and/or manager’s diligence and expertise in applying their environmental management skills.

Application/nomination forms must be emailed or postmarked by March 31, 2014. A national committee composed of pork producers and various pork industry and natural resource organizations will review all nominations and select the top recipients for national recognition.

Each farm selected for this award will be featured in a special report published in the Sept. 15, 2014 issue of National Hog Farmer. Winners will also be featured in a video produced by the Pork Checkoff and recognized during the Pork Industry Forum held in March the following year.

Additional information and an easy-to-use nomination form are available at the Pork Checkoff website or call the National Pork Board toll free at (800) 456-7675. 

SFP is a sponsor of the Environmental Stewards coverage in National Hog Farmer magazine.

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