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Articles from 1998 In November


Packer Contract Questions... And Answers

Will packer contracts be a good deal in the future? Iowa State University's John Lawrence recently tackled that question, evaluating several packer contracts currently used in the Midwest.

"There is no clear-cut, superior contract," he reports. Instead, the value depends on the type of contract being offered and a producer's needs.

Lawrence also fielded a number of questions about growing ledger accounts on some of the contracts. The questions deal with how the accounts are handled on balance sheets, the packer's position vs. the lender's position, and what happens if a packer goes out of business.

Contract Performance To evaluate the contracts for their performance, Lawrence simulated what the payments from several different contracts would average from 1988 to 1997. He assumed a hypothetical producer selling 100 hogs/week in the simulations. All the contracts are window or cost-plus contracts. Roughly 10% of the nation's hogs are marketed under this type of contract.

The results are shown in Table 1. Contracts 1 through 4 are cost-based with a ledger account. The producer is protected from prices below the floor, but must pay back the money when prices are on the upside. Contracts 5 and 6 are cost-based contracts with the producer not incurring a debt. Contract 7 is a flat floor price of $40/cwt. and not tied to grain prices. Contract 8 is a $38-48/cwt. window contract.

Some of the contracts reduced price variability experienced by the cash market during the 10-year period. The cash market fluctuated from $27/cwt. to $66/cwt. during that time. But the contract prices generally moderated from $32/cwt. to $66/cwt.

At the end of the 10 years, the average cash price was $47.29/cwt. About half of the contracts averaged $0.16-0.74/cwt. above the cash price. The rest were lower than the cash price, from $0.56-3.13/cwt.

Five of the contracts (1-4 and 7) included ledger or reserve accounts. "The packer essentially loans the difference between the floor and the open market," Lawrence explains. If a floor price is $40/cwt. and the market is $29/cwt., the packer loans the producer $11/cwt. The amount will be entered in an account. As hog prices move above the floor, the producer pays back on that account.

Lawrence's simulations of the contracts show ledger accounts in the positive, meaning the packer would owe the producer money. The accounts varied from $14,662 to $170,966 when using actual cash prices for 1988-97.

Ledger Accounts Build The story changes, however, should cash prices run lower. Lawrence simulated the contracts at 95% of the price levels of 1988-97. Those are also shown in Table 1.

In this simulation, the average 10-year cash price was $44.93/cwt. All but two of the contracts (the cost-based only contracts) showed average prices higher than the cash price. They ranged from $44.19/cwt. to 47.45/cwt.

At the end of the 10-year simulation, the ledger accounts ended up in the negative on two of the contracts. Producers would have owed $73,771 to the packer on one contract and $97,307 to the packer on another. Two contract ledger accounts were positive, though, with the packer owing $11,478 on one and $14,662 on another.

If the 10-year price dropped to 90% of what occurred in 1988-97, the ledger accounts grow massively. Lawrence based the simulations on an average cash price of $42.56/cwt. for the period. The contracts did their job by keeping average prices above cash.

The contracts with ledger accounts reduced the variability of prices the most. But the ledger accounts grew. One contract simulated a debt of $347,229 owed to the packer. Two other contracts showed a $330,030 and a $59,915 debt to the packer. Still another contract was left with a $14,662 positive balance, which the packer owed the producer.

Lawrence says many contracts do not limit the negative balance or address early termination if the balance grows larger than a producer's net worth.

Debt Position Questions Lawrence says he has heard questions about the ledger accounts and the packer's position vs. the lender's position on the debt.

After studying the contracts, he believes the lender still has first position on the debt. "I have yet to see a packer make a move to have a secured interest," he adds. Packers would need to file UCC (Uniform Commercial Code) papers to secure the debt against collateral. Until that is done, the packer is an unsecured creditor.

Another question is how the debt is handled on the balance sheet, Lawrence says. If it is considered a current liability, a large debt could create poor current ratios.

"Problems could occur if a new loan officer or bank examiners go over the books and see your working capital ratio of 0.7 and the bank has a covenant saying nothing below 1.5," he explains. "Some lenders put the debt off to the side on the balance sheet."

In the face of these simulations and questions, Lawrence suggests producers look carefully at packer contracts in the future. While packers generally are not offering contracts right now, they should be when prices improve.

Originally designed to lower risk, the contracts could pose financial problems if prices continue below the floor prices.

Do's and Don'ts for Hiring Employees

Hiring and firing employees can be ticklish business these days. Labor laws generally require employers to bear the burden of proof should any law be broken, according to Gloria Hanson, human resources officer for D&D Farms, Pierre, SD. So employers must take extra care to follow the rules of labor law.

"If you break the law, it can be expensive for you personally as well as for your company," Hanson says.

Hanson offers solid advice to producers who hire employees, advice she learned from her years of experience.

'At Will' Policy Important A big priority for employers is printing a written "at will" employment policy. Hanson says this is very important to protect the employer's right to fire an employee.

"The 'at will' law says I'm an employee and if I decide I don't want to be here, I'm not under any contract (and can quit)," Hanson says. "The same 'at will' statement is true with employers. They can release an employee for any reason, just as long as the employee is not discriminated against."

Hanson recommends putting the "at will" policy in an employee handbook. Without the policy in the handbook, an employee handbook can be considered a legal employment contract, Hanson points out.

Also, do not publish a discipline policy in the handbook. Hanson says once it is published, it must be followed. Many employers follow a three-times-and-you're-out policy. But if an employee commits an act that warrants immediate firing, the written three-times policy could cause legal problems. Recruiting

When recruiting new employees through ads or discussions, employers must be careful not to discriminate against any protected class of people. And about the only class not protected is the white male under the age of 40, Hanson adds.

The following employment criteria are illegal:

* Specific age limits - You cannot talk about specific age limits like "17-25," "under 40," "recent college graduate," or "long-term, career-minded people." All these comments suggest a young person is being sought.

* Sex characteristics - Also illegal are comments like "men only," "herdsman" or "girl Friday." Hanson suggests substituting swine technician for entry level jobs.

* Religious preference - Do not use "Christian person." Hanson says you should not talk about religion at all.

* Physical characteristics - A statement like "good health" suggests discrimination against disabled people. Instead, if certain physical requirements are necessary, state them in the ad and uniformly follow them. But make sure the requirements are job related and included in job descriptions.

Job Descriptions Good job descriptions should include the primary tasks, skills needed, pay range and supervisory information, according to Hanson.

This is the place to put physical requirements needed for employees to complete the job.

Skills needed may also include English-speaking. But Hanson warns that it must be necessary.

Employment Applications Review your employment applications for any discriminatory wording. Hanson recommends eliminating any questions dealing with the following:

* Date of birth or date of graduation.

* Marriage status.

* List of arrests. You can ask for a list of convictions, however.

* Medical history.

* Absenteeism due to illness.

Hanson suggests hiring a screening service to look into a potential employee's records, like driving records, convictions and worker's compensation. Approval must be received from the applicant to conduct the screening.

Hanson says D&D Farms uses a screening service to double-check people they have given job offers. The offers are contingent on the results of the screening. The cost of a screening is about $8/employee.

The screening can save an employer from a negligent hiring claim. For example, a company hires an employee with a bad driving record. Then the employee has an accident driving on the job and kills someone. The employer can then face a negligent hiring charge.

Checking References "It is harder and harder to get references," Hanson says. "If you get stonewalled, go back to the potential employee and ask for names of co-workers to call."

In addition, many employers are asked to give references on former employees. Hanson says the employer must keep all answers job-related or a slander suit may result.

Also, if someone is terminated, she says to be very close-mouthed about it. Don't discuss it with other people or employees.

Sexual Harassment Sexual harassment is a concern in any workplace, including hog operations. Hanson says the unique environment in a hog facility with its employee showers and the livestock reproductive areas can lead to sexual harassment problems.

Sexual harassment, strictly defined, means unwelcome conduct at work based on gender. It includes threats, inappropriate physical contact, verbal comments (babe, sweetie), nonverbal conduct (leers, whistles, gestures), and environmental conduct (suggestive pictures or posters).

Sexual harassment can affect both men and women and does not need to be sexual in nature, she adds. It can include any harassment, such as racial and religious.

Hanson advocates halting any harassment before it starts. "I spend a lot of time with new employees talking about sexual harassment," she says. "I tell employees to treat their fellow employees like they would want their wife, daughter, etc. treated."

Employees also learn the appropriate terms to be used in the facility to prevent uncomfortable language use.

If sexual harassment occurs or is suggested, an employer is obligated to investigate and take steps to stop it. This even includes cases where the employee doesn't complain, but the employer is aware of the harassment.

An employer's obligation to halt sexual harassment extends to activities outside the workplace, Hanson adds. If the harassment involves employees who met at work and the harassment occurs outside of work, the employer must try to stop it.

Hanson emphasizes that an employer has more than a legal obligation to halt sexual harassment. Such harassment leads to a hostile work environment, which cannot be good for any business.

Drug Testing More and more hog operations deal with drug problems, just like corporate businesses. Due to safety concerns around equipment and adult animals, some hog businesses opt for drug testing.

Hanson says if random drug testing is conducted, it must include everyone, including upper management, even the president of the business. And the written policy should state an employee may be terminated if he/she refuses to take the test.

Termination Employers carry a heavy burden to fairly terminate an employee. First, a termination should never come as a surprise to an employee, Hanson states. This should be true even if the termination involves violence. All employees should know that violence is not tolerated. In other cases, the employer should have discussed problems with the employee at the time the problems occurred.

Hanson also recommends never summarily discharging an employee. If an employer is upset with the employee, send the employee home for the rest of the day. Then, the employer can think about the situation overnight and, if necessary, fire the employee the very next morning.

When an employee is in danger of being fired, the employer or supervisor should use verbal and written warnings including ways to improve the problems. The language should be clear that the employee's job is in jeopardy.

When termination is necessary, Hanson says employers should carefully consider its timing. She recommends against terminating someone, for example, who is one year away from retirement, three weeks after a worker's compensation claim or seven months pregnant. A discrimination suit against the company may result.

The employer should strive to preserve an employee's dignity and confidentiality during a termination. Hanson suggests terminating someone in a private office and always with one other person present. This third person is the employer's insurance against untrue claims made about the termination and the possibility of legal action.

In conclusion, Hanson says employers should hire their employees carefully and treat them fairly. When an employer is faced with difficult employee problems, seek expert advice. It can only save you money in the long term if lawsuits are avoided.

Federal laws prohibit the discrimination of people based on the following: race and color, ethnic identification, national origin, religion, sex, age, disability and veteran status. Any hiring practices that suggest such a discrimination is illegal and could put you and your business at risk of a lawsuit.

Gloria Hanson of D&D Farms lists 10 questions not to ask prospective employees, then provides alternatives employers can use. Just keep in mind - ask every applicant the same questions or that could trigger a discrimination suit.

1. Don't ask: Which is more important to you, a family or a career? Ask instead: We need people interested in a career. What are your career goals? (But, the statement must be true, and the question asked of all applicants.)

2. Don't ask: What arrangements do you have for taking care of your children?

Ask instead: Sometimes we have to work overtime. How do you feel about that?

3. Don't ask: Do you have transportation to work? Ask instead: Would you have a problem getting here by 6:00 a.m. every day?

4. Don't ask: Are you Hispanic? Ask instead: Some of our employees speak only Spanish, and the ability to communicate with them is essential to the job. Can you speak Spanish? Or: What languages do you speak?

5. Don't ask: Do you have a high school diploma? Ask instead: Reading instructions and doing simple math are important parts of the job. Are you willing to take an aptitude test? (Again, this must be a true statement and asked of all applicants)

6. Don't ask: Do you use drugs? Ask instead: All applicants are required to undergo drug screening as a condition of employment. Have you any objections? (Must be a true statement and asked of all applicants.)

7. Don't ask: You're very overweight. Can you get around okay? Ask instead: The essential job functions require a lot of walking, bending and lifting. How do you feel about performing these function? (Must be a true statement and asked of all applicants.)

8. Don't ask: We don't let women do heavy or dangerous work. Okay? Ask instead: We work around large, adult animals and automated feed systems. How do you feel about heavy or dangerous work?

9. Don't ask: Are you an American citizen? Ask instead: Are you legal to work in the U.S.?

10. Don't ask: How many days have you missed work due to illness? Ask instead: How many days of work did you miss last year?

Comparing Worker Safety Concerns

Agriculture is still considered to be among the nation's most dangerous industries. John Shutske, University of Minnesota Farm Safety and Health Specialist, frequently gets phone calls from people seeking basic information about how to prevent injuries and illnesses on their farms.

Shutske and graduate student, Ruth Tripp, designed a study in cooperation with National Hog Farmer to help understand more about health and safety information needs of the pork industry.

Shutske emphasizes this project was not intended to be a comprehensive, pork-industry-wide survey. A leading Midwestern hog state, Minnesota (ranking third, nationally), was compared with North Carolina, a state known for large-scale pork production units employing significant numbers of people. The results of the research indicated a growing number of larger pork producers are seeking basic health and safety information for their employees. Interest in developing sound worker safety and health programs is on the rise.

Producers who are proactive about safety and health often end up with healthier workers, and gain a variety of benefits from reduced employee turnover and absenteeism.

This research project was designed to answer several broad questions:

What types of injuries and illnesses are employers most concerned about?

What kinds of injuries and illnesses are employers actually observing in their workplaces?

How many employers are providing planned safety and health training for their workers?

How do the health and safety needs of employers change as their operations grow and they employ more people?

Who should deliver health and safety information to employers and employees?

The researchers were attempting to better understand the regional differences in occupational health and safety needs among pork producers who were believed to have employees. A random sample of 600 pork producers, divided between Minnesota and North Carolina, was selected from the National Hog Farmer mailing list.

Minnesota and North Carolina were chosen as the states to be surveyed because of differences in overall production systems and intensity, as well as differences in employment patterns. It was believed North Carolina producers may have already experienced some of the employee health and safety concerns that Minnesota producers are just beginning to see. Health and safety issues may increase in Minnesota as reliance on hired workers grows.

Survey Results Employers in both states reported experiencing costs associated with employee injuries and accidents. In addition, they reported a growing concern about accident and injury levels among workers.

The five most common problem categories reported in both states were: cuts; strains and sprains; being stuck by a hypodermic needle; back and neck pain; and slips and falls. Table 1 shows the percentage of operations in both Minnesota and North Carolina that had costs related to injuries and illnesses.

Although "cuts" might seem like a relatively minor problem, the incidence of infection can cause more problems. Cuts may get contaminated by manure and a variety of bacteria (sometimes antibiotic resistant bacteria). Employers need to identify which tasks run the highest risk of employees being cut. Gloves or proper shoes could be somewhat helpful in preventing cuts, Shutske suggests.

The incidence of needlesticks in the pork industry appears to be a problem that warrants further prevention efforts. Reactions from accidentally injected medications, or potential infection are the main concerns from sticking injuries.

Shutske was surprised that needlestick problems ranked so high. "Hospitals and clinics have gone to great efforts to develop programs and facilities for managing needlestick problems," he says. "Perhaps better training could help reduce the problem in hog operations as well."

Back injuries and back pain are common in most labor-intensive industries. "Employers do need to be concerned about these seemingly routine injuries because they cause a disproportionate level of employee absenteeism and they are a huge contributor to workers compensation insurance costs," Shutske says. "Back injuries are at least one-third more expensive than all other types of worker's compensation claims and account for more than 30% of all claims in all industries." The National Safety Council reports the average, lost-time, back injury claim was $24,080 in 1990.

Employees should be trained in proper lifting techniques (lift with knees bent, back fairly straight, etc.) to reduce back strains and sprains. Producers should consider use of tools that make lifting tasks easier. Lifting feed in smaller quantities or partial bags can also help reduce the likelihood of injuries.

Keeping objects picked up and out of the way to eliminate the possibility of tripping is one way to help reduce slips and falls. Shutske says, when possible, aisles should be designed to make it easier for people to move around. Good work shoes/boots that provide good traction and flooring that offers enough traction could help. Keeping aisles clean and dry could also reduce hazards.

North Carolina employers voiced slightly more concern about worker safety and health compared to Minnesota employers (Table 2). The difference was more apparent among smaller scale producers with fewer than 11 employees.

Shutske speculates that North Carolina producers may be more concerned because they are subject to a higher level of regulatory activity. Some 25% of the surveyed producers in North Carolina reported having been inspected by an Occupational Safety and Health Association (OSHA) representative at least once. Only 5.1% of the surveyed Minnesota producers had been subjected to an OSHA inspection.

Among the Minnesota producers who purchase worker's compensation insurance, 21% indicated worker's compensation costs were increasing. Nineteen percent of the North Carolina producers who purchase worker's compensation insurance noted an increase.

Shutske says worker's compensation rates for a particular industry reflect the losses experienced within that industry. However, individual employers can often get lower rates if they maintain a clean, claim-free record. These discounts vary across state lines, and by specific insurance provider.

"In most areas of the country, worker's compensation providers are eager to work with their clients to prevent losses, and can be a great source of safety and health information," Shutske says. Worker's compensation insurance providers can provide training materials or referrals to safety consultants.

Shutske notes survey respondents were more concerned about injuries and illnesses if they had experienced some type of problem (Table 3). "This increased level of concern is often just simple human nature," he says. "Employers who have not yet experienced a costly injury or occupational illness need help to be proactive, rather than waiting for something bad and costly to occur."

What are producers doing to train their workers about preventing injury and illness?

Shutske says 41.9% of Minnesota employers surveyed reported offering some type of planned worker safety training to address issues like respiratory protection, animal-handling techniques, safe lifting, and basic first aid. Producers providing workers with training was higher in North Carolina (54.9%).

Training is less common among smaller employers in both states. See Table 4 for an overview of the type of training being provided in both Minnesota and North Carolina.

Regardless of minimum regulatory requirements, employers should provide periodic, structured worker training. "It is a good idea to cover at least one or two priority topic areas monthly," Shutske suggests. "Workers trained in proper techniques and procedures will not only have fewer occupational safety and health problems, but they will also likely be more productive and efficient."

The data from this survey suggests additional training is required in the areas of using personal protective equipment, safe lifting techniques, proper use of hypodermic needles for medications and vaccines, and proper footwear and housekeeping to prevent slips and falls.

"Over the years, we have also collected farm fatality data that suggests producers need to develop training programs and written policies that outline the proper procedures for entering confined spaces (like manure pits and bins) and for proper operations of powered equipment such as augers, feeding systems and tractors," Shutske says.

Farms with more than 10 employees are subject to OSHA inspections in most states. Training and efforts to eliminate hazards forms a foundation for regulatory compliance on these eligible farms.

"An employer with a solid, well-documented, and accurate worker training program will be viewed in a positive light by OSHA, since training is often viewed as a 'good-faith' effort in showing concern for employees," Shutske adds. "If possible, it is better to eliminate a hazardous situation in your operation than to train employees to work around it."

Shutske and Tripp also asked producers where they would like to receive occupational safety and health training. Veterinarians were viewed as preferred sources of information. Insurance companies, safety consultants, the extension service and pork production magazines were also popular sources.

Survey results showed large pork industry employers in Minnesota are relying much more heavily on paid safety consultants as compared to their larger counterparts in North Carolina. Producers of all sizes in North Carolina are slightly more likely to use the free, consultation services of OSHA.

OSHA services vary by state, but can be used as an inexpensive way to supplement an existing worker safety/health program. A farm employer requesting an OSHA consultation will receive a free inspection with specific recommendations made by the consultant.

"Even though the consultant is generally not allowed to levy fines or penalties during the consultation process, there is an expectation that specific problem areas identified in the inspection will be corrected," Shutske cautions. Producers should check with their state department of labor about available inspection services and procedures.

Emerging E. Coli Hits Weaners

For years there have been K88, 987P, F41 and K99 in the group of E. colis that mainly affects pigs before weaning. Add to that list F18, the newest E. coli pilus that carries a twist: it strikes pigs 10 days postweaning.

And it can strike with a vengeance, according to Harley Moon, DVM, professor in charge, Veterinary Medical Research Institute, Iowa State University (ISU).

"This E. coli seems to colonize and be shed in tremendous numbers in association with disease in the second week postweaning," he says. F18 can appear in conjunction with K88, producing profuse and sometimes fatal watery diarrhea and sudden deaths.

Particularly in large farms, gut edema has also been seen in association with F18 and K88 E. coli, producing death losses in the 10-20% range. Just as high can be impaired weight gains and other performance problems.

Survivors do reportedly develop an immunity to the infection. However, the arrival of new pigs in the system all of the time, provides a succession of susceptible pigs for this enteric nursery disease.

There are reports of nurseries experiencing the problem for months on end. There been a few cases of F18 E. coli now and then, but not an overabundance of reported problems, according to the ISU diagnostic laboratory.

To some industry sources, it's not that this newer E. coli has so much emerged as a major pathogen as it is that farms are so much larger, magnifying problems.

Therapy Moon says antibiotic therapy has proven frustrating for producers trying to cope with lethargic pigs off feed. The antibiotics seem to work for a while then resistance develops. Neomycin and gentomycin are two possible antibiotics to try.

Producers are also trying to encourage these weaned pigs to eat better by providing them with many small feedings per day and improving hygiene to prevent fecal-oral spread of the E. coli strain, he comments.

Some suggest that this E. coli infection is being precipitated by ration changes and/or pigs not having adequate feed available at all times. And one idea is to try and add fiber to the diet in the form of ground, whole oats or alfalfa meal to reduce diarrhea problems.

"There are likely some things we could do to modify the diet to help alleviate this problem," says Jerry Shurson, swine nutritionist and director of the Swine Center, University of Minnesota. He suggests adding high levels of zinc oxide, 2,000-3,000 ppm to the postweaning diet for up to two weeks as drug therapy.

Diet acidifiers may also make a difference by boosting acid levels of young pigs, keeping gut pH levels low, and thus helping to fend off disease organisms, says Shurson.

As far as suggestions of increasing fiber content to relieve diarrhea, he cautions that the use of less palatable feed ingredients such as ground, whole oats or alfalfa meal may further reduce feed consumption.

"High-fiber ingredients reduce the energy concentration of the diet, which further reduces energy consumption of the pig," he says.

The ultimate answer for treating the F18 E. coli probably lies with development of a vaccine, observes Moon. The challenge is much greater than developing a vaccine to protect the pre-weaning pig which is infected with E. coli during the first few days of life. Killed virus vaccines can be injected into the sow and the passive antibody response is passed along quite nicely to the pig via her milk, he notes.

But in the case of the postweaned pig, the job is more complicated because antibodies aren't coming out of the blood and into the sow's milk.

Instead, the vaccine must provide protection right to the gut of the pig, which must develop its own active immunity at the site, explains Moon. The other challenge is to time vaccination to avoid being blocked by maternal antibody, yet providing active antibody soon enough to protect nursery pigs from this newer E. coli challenge, he stresses.

It's a job that researchers globally are working on, says Moon. Best chance is to develop a modified live virus vaccine from isolates positive for the F18 E. coli, but negative for gut edema disease. It is the latter which seems to accompany and exacerbate the E. coli infection in young nursery pigs.

That way the vaccine could stimulate immunity, but wouldn't give off the enterotoxin associated with E. coli infections.

There's no doubt that F18 E. coli strains produced by the interaction of the bacterial and gut edema infections are in a class by themselves, states Dick Wilson, director of the E. Coli Reference Center at Pennsylvania State University. He says when you take an E. coli toxin and combine it with a Shiga-like toxin, as is seen with gut edema disease, you produce a dangerous combination. Shiga toxins can affect all animals and humans. The F18 E. coli is only found in young nursery pigs.

PRRS Challenge Getting Tougher

The ever-changing PRRS virus keeps producers and researchers off balance in their efforts to control it.

In the past several years, control schemes have been on the rise. There has been more talk of herds successfully cleaning up and staying negative to PRRS orPorcine Reproductive and Respiratory Syndrome. The industry has been pressuring breeding stock firms to guarantee their product is free of PRRS. And, the outlook has been positive for controlling PRRS.

But well into 1998, sentiments may be on the verge of changing. Top PRRS researchers now are saying strains or isolates of PRRS are mutating in ways that make them tougher to deal with, and may require different control strategies. Several industry leaders are saying better PRRS vaccines will be needed.

Crisis Coming? Many view the so-called atypical PRRS outbreak of 1996 as something besides PRRS virus because it was characterized by abortion storms and numerous sow deaths, the likes of which hadn't been seen since the early days of the disease in the late '80s.

But now it appears that maybe those hot strains of atypical PRRS are starting to become more typical of mainstream PRRS problems.

USDA officials at the National Animal Disease Center (NADC) believe much of the early confusion regarding atypical PRRS was due to inadequate sampling procedures for virus isolation.

"More recent studies have almost conclusively established that the unusually high incidence of abortion, and sometimes sow death, were caused by new, hotter strains of the PRRS virus," explains William Mengeling, DVM, research leader of the Swine Virology Unit at NADC.

He goes on to point out that what was seen in the field has now basically been reproduced in the lab. Origin of these new strains is still in question. But Mengeling speculates they simply arose from mutations that markedly increased their ability to cause clinical disease.

PRRS is an RNA class virus known for its ability to mutate and adapt readily to its environment. This ability has raised two emerging concerns:

* Strains or isolates of PRRS seem to mutate frequently, getting hotter and harder to control as they do so;

* Some so-called stable sow herds don't appear to have stable immunity after all, and are being implicated in infecting their piglets before birth.

"My belief is that there have been some more virulent strains that have evolved during the last several years," observes Mengeling.

Any response to infection by the pig's immune defense mechanism can be counteracted by a viral mutation that makes it less easy to control. Neutralizing antibodies which normally prevent the virus from infecting cells may be neutralized themselves by other virus mutations that are both antigenically different and more difficult to control. "We suspect that is what happened with the strains associated with atypical PRRS," says Mengeling.

Besides the body's natural defenses, antibody titers are also produced when the pig is vaccinated against PRRS. But here again, the challenge is becoming stiffer.

According to Mengeling, the current modified live virus (MLV) vaccines for PRRS seemed more effective prior to the emergence of these new strains of PRRS virus. He explains there may be several reasons for this change, the most likely just the added virulence of new strains.

Mengeling observes: "For example, when young pigs were infected experimentally at the NADC with strains isolated before 1996, they sometimes became listless and failed to gain weight at the same rate as uninfected controls. But they rarely had any noticeable clinical signs.

"Conversely, pigs infected under the same conditions with strains from more recent cases of atypical PRRS were severely affected and some died without complications of other secondary diseases," he says.

Viral Recombination Viral recombination or joining of two viruses to form a virus with a different molecular structure is being touted as one source of proof that PRRS strains have altered, according to a research trial reported on by molecular biologist Michael Murtaugh, University of Minnesota at the Leman Swine Conference in Brooklyn Park, MN, in mid-September.

Molecular analysis of 10 U.S. strains during 1990-1992 showed significant genetic variation and that viral recombination may be involved. Another study of 50 PRRS samples isolated in a seven-year time period from the start of PRRS outbreaks, showed that an isolate in North Carolina in 1993 was the product of recombination between two strains on farms in adjacent counties.

When developing vaccines, steps should be taken to avoid viral recombination and undesirable offshoots of the vaccine, points out Murtaugh.

All that doesn't mean that the current MLV vaccines aren't any good. PRRS virus is showing up in vaccinated herds simply because there are quite a lot of PRRS-vaccinated herds in the U.S., notes Mengeling. But it's also a fact that the vaccines are having a tougher job protecting the pig from the newer, hotter strains.

Key is to vaccinate well before the time the pigs become exposed to the field virus, he emphasizes. "That's because it takes more time for pigs to develop immunity to PRRS virus than to most other viruses," states the USDA researcher.

In a simple but striking trial at NADC, it was found when pigs were exposed to a mixture of vaccine and field strains of PRRS virus, the field strain quickly dominated - even when the mixture contained a 10-million-fold excess of vaccine virus. "More importantly, from a practical perspective," says Mengeling, "there was no evidence that the simultaneous administration of vaccine virus had any effect on the outcome of the infection."

Vaccine Rotation What about rotation of current MLV PRRS vaccines to improve overall effectiveness?

Minnesota's Murtaugh advises against it, suggesting that "deliberate mixing of different PRRS strains by simultaneous vaccination with multiple products increases the likelihood of recombination and could artificially accelerate the rate of genetic change in PRRS."

In contrast, Mengeling says he isn't sure the potential drawbacks outweigh the potential advantages. He says it is possible that vaccination with two or more attenuated, vaccine strains would provide broader protection. This dual infection already occurs to a degree when vaccine is used during an outbreak.

But he cautions that without further study, it is premature to adopt either vaccine rotation, or the use of multi-strain vaccines. "Although I don't see any clear downside to such procedures, I think that before someone buys into it wholesale, the idea ought to be thoroughly tested for safety and efficacy."

Need For New Vaccines In order to deal with what could be a never-ending parade of new PRRS strains, it may be necessary to periodically alter the strain content of vaccines. That may lead to second generation and, eventually, third and fourth generation vaccines for PRRS.

It may be that the cost of constantly testing and licensing new vaccines could be a problem - especially during times of unfavorable hog markets, notes Mengeling.

Of course, the PRRS vaccines are like any others in that they are one of several management tools necessary for effective PRRS virus control, according to Reid Philips, DVM, Professional Services, Boehringer Ingelheim/NOBL Laboratories, Inc., makers of RespPRRS, an MLV PRRS vaccine. Another MLV PRRS vaccine, Prime Pac PRRS, is sold by Schering-Plough Animal Health.

The vaccines must be used properly, according to label recommendations, and properly stored when not in use to preserve vaccine potency, Philips says.

Veterinarians and producers have learned that they must also focus on management strategies and vaccine for effective control of PRRS, he says.

Philips agrees the PRRS virus is changing and the challenge will be to develop new generation vaccines. He says BI/NOBL is dedicated in its efforts toward ongoing and improved PRRS virus protection. The company and its swine-focused staff strive to learn more about the virus, control and prevention measures and continue to investigate new products to provide greater protection against PRRS.

Pork producers have been advised to only bring in PRRS-negative replacement gilts. Some would argue that a PRRS-positive gilt affords some protection from breakdown upon entry into the new herd.

But PRRS researcher and veterinarian Scott Dee of Swine Health Center, Morris, MN, says it's just a lot easier to control PRRS by starting out with a negative, uninfected gilt. He strongly advises now, more than ever, against purchasing previously infected, incoming replacement gilts.

Infected Before Birth Preliminary data is also producing a new concern: gilt litters that are infected early in life.

Dee has detected piglets from gilt litters which are infected on day 1 or 2 of life. They may have been infected during gestation as the virus crossed the placenta, or from the sow during lactation, he says.

Declares Dee: "I think a lot of the problems with perceived vaccine failure are due to suckling piglets that are infected prior to vaccination. The common practice is to vaccinate pigs at weaning in an attempt to control the disease in the nursery. However, if piglets are infected very early, it's difficult to time our vaccination correctly. Vaccinating animals which are viremic (virus circulating in the bloodstream) following infection with field virus reduces vaccine efficacy."

According to Dee, who will add his PRRS expertise to the University of Minnesota when he joins the Swine Medicine faculty in January 1999, molecular diagnostics are helping him to realize that PRRS infections can now start early in life.

"The scary thing about it is that infection of the suckling piglet can occur in herds that appeared to be very strong candidates for stability, according to serology, and clinical presentation of excellent reproductive performance.

"But in some of those cases, we found viral infection of piglets as early as 1-2 days of life," states Dee. He says through use of PCR (polymerase chain reaction) molecular diagnostic technology he was able to detect the PRRS virus and then sequence it to prove that it was a field virus, not vaccine virus.

Dee says he is not able to pinpoint in his research whether actual infection with PRRS occurred transplacentally or through colostrum. But he points out that other scientists have proven both means are possible.

"It's a very sporadic, low level of shedding. On observation, you can't detect it in the piglets prior to weaning, because they are suckling and have maternal antibodies from the gilt/sow. Clinical problems become evident postweaning.

Therefore, it may provide an explanation for PRRS problems in the nursery in spite of top management and vaccine regimes. Production data indicates an increase in nursery mortality of 1-2% and clinically 5-10% of the pigs appear to be affected.

For their part, pork producers are frustrated spending money on vaccine and having it fail. Dee says he is advising producers they are going to have to also spend some money on diagnostics to determine if infection is occurring at the suckling piglet level. PCR testing followed by virus isolation is needed in order to determine the actual point of infection in the life of the suckling piglet, he says.

NADC Research Several projects on PRRS are being pursued at NADC in a relentless effort to find a weak spot in the PRRS virus, says Mengeling.

Besides the ease with which strains mutate, he is especially concerned with persistence of the virus in the pig. "When you infect a pig and the virus is still there six weeks later or longer, you know it is going to be problematic as far as immunity and developing a vaccine are concerned," he comments.

NADC is using the new strains of PRRS in efforts to develop their own modified live virus and killed PRRS vaccines, at the Ames, IA, research facilities.

Already, NADC has developed a quick genetic test to help differentiate between PRRS field virus and the vaccine. NADC and Boehringer Ingelheim/NOBL jointly evaluated the diagnostic test and the company has now secured a license for the test.

General information on PRRS including cause, clinical signs, diagnosis, transmission, prevention and control can be obtained on a website on the Internet at: www.vetsci.sdstate.edu/Prrs.htm

The site is produced by South Dakota State University Extension Veterinary Science, in cooperation with the American Association of Swine Practitioners. Checkoff dollars from the National Pork Board also are used to provide the website.

Minnesota veterinarian Scott Dee believes that when its comes to control of PRRS (Porcine Reproductive and Respiratory Syndrome), gilt management is indeed the key to a successful PRRS control program. Follow these four tips and you enhance your chances of keeping PRRS at bay:

1. Only buy naive, uninfected animals. Buying negative gilts reduces your overall risk of PRRS spread throughout the herd.

2. Don't rely solely on natural exposure. Vaccinate incoming naive gilts and provide four weeks in isolation before moving them to acclimation. Make sure to vaccinate gilts with a modified live virus (MLV) vaccine that ensures consistent exposure to an attentuated live virus (from the vaccine), something that natural exposure fails to do on a consistent basis. Gilts are to be revaccinated upon selection (5 months of age).

Dee just completed a field trial which shows the inconsistency of natural exposure. Thirty PRRS-negative replacement gilts were housed three to a pen for acclimation. Two PRRS-infected nursery pigs or "seeder pigs" were placed within each pen of gilts for 30 days. Field data showed the seeder pigs shed virus sporadically during the 30-day acclimation period. From that exposure, only 50% of the gilts tested positive for PRRS.

3. Gilts may need to be vaccinated at day 50 of gestation to prevent the formation of susceptible animals. Duration of immunity of MLV PRRS vaccines has been demonstrated to be four months. Often, gilts are introduced as weaned piglets 16-18 days of age and selected for breeding at 5 months of age. If an animal is bred at 7-8 months of age, allowed to gestate and lactate, 6.5-7 months of time may elapse before revaccination during lactation or prior to breeding.

One option, Dee suggests, is to revaccinate gilts at day 50 of gestation. "Controlled studies have shown that day 50 of gestation is a very safe point in which to vaccinate pregnant sows." It should eliminate infection of the litter before birth.

Dee stresses that this is not a "6-60" vaccination protocol. The "6-60" program consists of vaccination at day 6 of lactation and day 60 of gestation in all animals in the herd on a routine basis.

The use of vaccination at day 50 should be only practiced if a replacement gilt vaccination (as above) is used. Plus, diagnostic evidence of viral shedding from gilts down to suckling pigs should be demonstrated as well. There has been no such data described for the 6-60 program.

4. Document with diagnostics the point of infection of the suckling pig before starting control strategies. Monitor when infection is taking place in lactation and if there is a parity involvement. Random sampling of pigs from day 1 up to weaning using molecular diagnostics is more accurate than serological profiling.

It becomes critical to pinpoint the exact point of infection in the pre-weaned pig when vaccination is being used to control PRRS infection postweaning, says Dee.

Easing A Capital Crunch

Partial liquidation or restructuring debt may help some producers weather the low hog cycle.

One quarter of back-breaking hog prices is taking a toll on many hog enterprises. Current hog prices are not covering most farms' operating expenses and debt service. This shortfall in working capital makes lenders and suppliers nervous, possibly leading to liquidation of assets or debt restructuring.

The issue here is a lack of working capital. What can pork producers do about a loss of working capital?

Financial management specialist Allen Lash recently addressed that question and others regarding working capital during a National Pork Producers Council teleconference.

"A lot of producers have used all of their working capital to expand their hog operation," Lash acknowledges. "And when they hit a time like now, with low prices and inadequate profits, they don't have that cash or liquidity cushion. Some are just forced out of business."

On the other hand, hog operations with enough working capital can ride through tough times, he adds.

What Is Working Capital? Strictly defined, working capital is the difference between current assets and current liabilities. Current assets include the assets normally sold in a 12-month course of business while current liabilities is the debt that will have to be paid in a 12-month cycle.

Lash says nearly all lenders have those two items on the same line so they can be quickly subtracted, telling the lender if the farm has more liabilities or assets.

Working capital pays things like a hog farm's operating losses, family living expenses and debt service. It also is used for expansion or prepayment on debts.

"Obviously, a business should want more cash available over a 12-month period than they are going to have expenses, or they will run out of money," Lash explains.

From a lender's perspective, low working capital means debt won't get paid. This usually forces a producer to make changes to improve working capital.

Gaining Working Capital The options to improve working capital at a time like now are not plentiful. He offers three viable options:

1. Partial liquidation - Lash says this is one of the best ways to improve working capital today. He suggests producers find the least productive assets and sell some of those to pay down current liabilities.

"We know from past experience that most producers can sell 15-25% of their assets without dramatically impacting revenues and profits," Lash reports.

What should be liquidated depends on each producer. Producers with a strong commitment to pork production might look at liquidating crop assets, for example. "Farmland has such a poor asset turnover and very little ability to generate revenues that an operation may need for cash and expansion," he explains.

Other operations may look at liquidating one part of their production enterprise. For example, a producer interested in finishing only may want to liquidate their farrowing enterprise.

2. Add equity - Another method to improve working capital is adding equity. For a sole proprietorship, gifts or an inheritance will add much-needed equity. In a corporationor partnership, the owners or partners put in capital.

3. Restructure liability - Producers can restructure their current debt into non-current debt by obtaining 3- to 10-year loans. Lash says this option merely buys time for the producer to solve their debt problem.

Lash adds that there are two other methods to reduce working capital problems; neither is a good option now. One is to generate more profits. But, when producers are losing money in a low hog cycle, this is not a possibility. The other method is writing down debt. Lenders shun this option. It should be reserved for bankruptcy court.

Working Capital Minimums Pork producers should achieve minimum levels of working capital, depending on the size of their hog operation. Lash suggests several minimum levels, which are higher than many lenders may require.

"Producers must protect themselves from things like disease, economic cycles, and those kind of problems," he explains. "Otherwise, when they run out of capital, they are unable to stay in business."

He suggests a farrow-to-finish operation look at 30% of annual revenue for working capital. For example, an operation with $500,000 in annual revenue should have at least $150,000 of working capital.

On a per-sow basis, Lash says about $500-600/sow is a good working capital level. So a producer adding 100 sows to a herd should shoot for $50,000-60,000 in additional working capital.

Farrow-to-nursery operations need working capital equal to 40% of annual revenues. The working capital needs for a farrow-to-wean operation is at least 30% of revenue.

Producers purchasing early weaned or nursery pigs should look at 40% of revenue for working capital.

When the hog cycle starts to head back up and producers look at expansion, Lash offers some timely advice: Don't use all your liquidity for expansion. He recommends producers maintain the working capital minimums just outlined. New producers need to arrange for working capital through their lender. Lash says they should get a commitment from the lender to provide adequate working capital.

Following minimum working capital guidelines should help producers weather this and other troublesome hog cycles.

Rolling To Roth Looks Better For Some

An optimist can pull something good out of a situation even as bad as 1998 hog prices. This time it can be the Roth IRA opportunity. If you have IRA, Keogh or SEP retirement investments, rolling some or all of them to a Roth IRA before year end is worth studying for long-term tax savings.

Let's see how a Roth IRA rollover might fit especially well this year.

Traditionally, IRA, Keogh and SEPs have been tax deductible when you invested the money for your retirement. Earnings were also tax deferred.

Therefore, when you start taking the money out of a traditional plan during your retirementyears, you would pay income tax on all of it.

Now, along comes the Roth IRA that allows you to roll your current tax-sheltered, retirement money and pay some tax now, but never have to pay any more tax on it in the future.

The Roth IRA is named after Senator William Roth, Jr., chairman of the Senate Finance Committee.There are really only two rules:

* Your adjusted gross income for the year you roll can't be more than $100,000. That applies to both single and joint return filers.

* Keoghs have to be rolled over to an IRA before they can be rolled into a Roth - just an extra paperwork step.

"You don't even have to move the money to roll it," says Paul Christoffers, a retirement and benefits planning specialist in Ankeny, IA. "You can leave it in exactly the same investment it has been in. Or, you may want to look at some new investment strategies."

Rolling isn't, of course, tax free. If you decide to roll $20,000 of your IRA investments to a Roth IRA, you have to report that $20,000 as income on your 1998 tax return. If you pay federal income tax on that at 15%, that will cost you $3,000. Plus, depending on your state, there might be state income tax. Maybe that's another $1,000 for a $4,000 total.

"Actually, you can spread that income over four years and pay the tax at a slower pace if you do the Roth roll in 1998," says Duane Murken, an Iowa Farm Business Association consultant at Swisher, IA.

"You can still roll to the Roth in future years," he says. "But there's no spreading of the income. Any amount you roll after 1998 will be reported as income on that year's tax return."

Once you pay the tax, however, you will never pay tax on that $20, 000 in our example again. And you won't pay tax on any of the growth from that $20,000.

Advisors suggest that you pay the tax from money outside your retirement plan so you have the full amount ($20,000 in our example) left to grow tax free.

But any way you shake it, you lose the use of the tax paid ($4,000 in this example). It's not available to earn interest. You paid the tax earlier than you would have to and that goes against the grain of most farmers and income tax advisors. That's the disadvantage of rolling to a Roth.

However, rolling part or even all of the money you have in IRAs before year end may be a smart move. That may be true even if your 1998 income is relatively good. It depends on your situation.

Low-Income Year Strategy What if your income is really low or you have a loss on your tax return for 1998?

That can be the opportunity to really harvest the benefits of a rollover to a Roth, says Murken.

Let's use an example where you add up all the income and losses (assume you have a farm loss for 1998) that you will list on the front page of Form 1040 of your 1998 tax return and you come up with exactly zero.

Now, add in $20,000 of rollover to a Roth. Your income becomes $20,000. But you're not done yet. You can deduct some things from that. You have a standard deduction of $7,100 if you're filing a joint return.

Each person (you, your spouse and each dependent child) gets a $2,700 personal exemption.Those add up to $12,500 ($7,100 + $2,700 + $2,700) assuming you are married but have no dependent children to claim. Subtract that from the $20,000 total income and your taxable income would become only $7,500. At the 15% federal rate, that would trigger only $1,125 of federal tax. That's only 5.625% of the $20,000 rollover. Even if you have to pay some state tax, that's going to be a bargain since you will probably be in a higher tax bracket during retirement. Plus, future growth will be tax free.

"You may want to roll enough into a Roth to push your taxable income up to the top of the 15% tax rate," says Murken. "That taxable amount is $42,350 in 1998 for a married couple filing a joint return." It may even pencil out to roll into a Roth when some of the dollars will be taxed beyond the 15% federal rate, of course.

In cases like our example, where you have low income and a low tax rate, you may not want to use the four-year averaging option, saysMurken. You may prefer to roll some IRAs to the Roth IRA in years when your income is low and do nothing in high income years.

If your income is too low to use all your personal deductions such as the health insurance deduction, your standard deduction and your personal exemptions, work with your advisors to see if and how much of your IRA, SEP and Keogh investments you should roll to a Roth IRA. If you don't use those deductions this year, they are lost forever. Study it well ahead of year end to give you time to make the changes.

Is Roth Better? It's really hard to run the numbers on a rollover because it's difficult to compare when you're looking at some dollars that are taxable and some that aren't. You're also looking at different lengths of time the money will stay in and come out.

When all things aren't equal, it's like comparing apples to oranges and the answer isn't going to be completely clear.

Christoffers uses a farm example as a general rule: "Would you rather pay tax on the kernels you plant (a small amount) or on the kernels you harvest?" The Roth rollover may let you pay a small amount of tax now rather than a lot later.

To compare this to a traditional IRA, let's say the IRA is $10,000 now and is kept as an IRA. If you leave it for another 15 years and earn 7% annual interest compounded, it will grow to $27,590. If you could take it all out then and pay 15% tax, you would have $23,450 after tax.

But what if you pay 15% tax on it now and roll it to a Roth that will never be taxed again. Your $8,500 left after paying tax would grow to exactly the same $23,450 in 15 years at 7% and there would be no more tax to pay.

However, if you pay tax at 15% now and 25% later, you would only have about $20,690 if you leave it as a traditional IRA versus $23,450 for a Roth IRA.

Paying tax out of other funds and leaving the full $10,000 to grow tax free rather than $8,500 would also show an advantage for the rollover.

With even a 15% tax bracket, $1,500 earning 7% would grow to about $3,570 after tax in 15 years. But $1,500 growing tax free would grow to nearly $4,140. Everything else being equal, there's always a huge advantage to money growing tax free.

Decision Making Guidelines As you can see, accurate projections of your advantage or disadvantage of rolling to a Roth are difficult. The best advice is to work with an advisor such as your income tax consultant or accountant. But, there are also some general guidelines provided by Murken and Christoffers.

The longer you can let your account grow until you start drawing from it, the greater the advantage of the Roth. Therefore, younger people will generally benefit more from rolling to the Roth than will older people. If you're older, still consider it; but study it closer.

The higher the expected return from your IRA investments, the more you will gain from rolling to a Roth.

The more you expect your tax bracket to go up between now and when you will need to take the money out, the better your return will be from rolling to a Roth. However, if you expect your tax bracket to be lower during retirement than now, you had better pencil real hard before you roll.

With the Roth, there is no rule that you have to start withdrawing money at age 70 like with the traditional IRA - or at any other age. Therefore, if you want more flexibility on withdrawals, consider the Roth.

Another situation where the Roth rollover looks good is if you never plan to use some of that retirement fund money. You figure it will still be there for your children to inherit. If you don't roll it to the Roth, your children will have to pay income tax on it when they receive it. If you do roll it, they won't have to pay any income tax on it.

Therefore, if the tax rate now is reasonable, roll at least the amount you never plan to use into one.

Mycoplasma Displaces PRRS

Ranking the big three in Porcine Respiratory Disease Complex (PRDC) has been easy: PRRS (Porcine Reproductive and Respiratory Syndrome), mycoplasmal pneumonia and swine influenza virus (SIV).

That ranking has been virtually undisputed since PRDC was identified a few years ago as the cause of grow-finish respiratory stall-out, some refer to as the "18- to 20-week wall."

Now comes new evidence which seems to indicate mycoplasmal pneumonia is the chief agitator in PRDC, not PRRS.

The Surprise Leader It's no secret that PRRS and mycoplasma add up to a serious dual infection in pigs. The assumption is PRRS virus always comes first, stirring things up, leaving the pig's immune system open to secondary bacteria, led by mycoplasmal pneumonia. Often coming next is SIV, followed by a large cast of minor diseases.

Surprisingly, however, the order of the top two in importance may be reversed.

"Classically, we were taught that viruses cause immune suppression and then the bacteria are secondary invaders," says Eileen Thacker, DVM, associate scientist at Iowa State University's (ISU) Veterinary Medical Research Institute (VMRI).

"But what our trials are showing is that it was the mycoplasma that was making the viral condition worse," she says. That is, mycoplasma causes PRRS-induced pneumonia to worsen.

Thacker says this revelation suggests the control of mycoplasma infection may be important in decreasing the impact of PRRS virus-induced pneumonia and, ultimately, PRDC.

In a study reported at the International Pig Veterinary Society annual meeting in Birmingham, England, Thacker compared seven groups of 20, two-week-old pigs. Groups were infected with mycoplasma 21 days prior to, concurrent with, or 10 days following administration of PRRS virus. Control groups received one or the other of the organisms or nothing. Pigs were then necropsied, 3, 10 and 28 days after they were experimentally infected to check the lungs for infection and lesions from mycoplasma and PRRS.

Without exception, Thacker reports that all pigs infected with PRRS and mycoplasma experienced more severe clinical respiratory disease than those pigs only infected with one or the other of the respiratory organisms.

At necropsy, PRRS-induced pneumonia showed up in PRRS-infected pigs three days after infection. Mycoplasma-induced pneumonia was evident 10 days after infection. At 28 days post-infection, all of the dual-infected pigs continued to show signs of PRRS-induced pneumonia. Only two of eight pigs given PRRS virus alone showed signs of PRRS-induced pneumonia at 28 days post-infection, says Thacker. Mycoplasma-induced pneumonia was similar in all age groups of pigs infected with mycoplasma alone, regardless of the PRRS virus infection status.

At 10 days post-infection, microscopic lesions in the lung indicative of mycoplasma were more severe in the dual-infected group. By 28 days after experimental infection, lesions from both mycoplasma and PRRS were more severe in the jointly infected pigs, compared to pigs given a single organism.

According to Thacker, mycoplasma increased the severity of PRRS-induced pneumonia regardless of the order of infection, whether mycoplasma or PRRS was given first to the pigs.

Also, PRRS-linked pneumonia increased in severity even when the mycoplasma infection was very mild, Thacker points out.

"This experimental challenge model demonstrates that mycoplasma acts as a co-factor in potentiating or augmenting PRRS-induced pneumonia," she states. The fact that mycoplasma made PRRS pneumonia worse was documented clinically, macroscopically and microscopically.

Most telling is that all pigs in all of the groups infected with both mycoplasma and PRRS experienced more severe pneumonic lesions caused by PRRS.

Because there wasn't an increase in levels of either mycoplasma or PRRS virus levels in the dual-infected pigs, it suggests that the increased severity and duration of PRRS-induced pneumonia may not be due to an increase in either of the pathogens, according to ISU's Thacker.

"Rather, we propose that the chronic inflammatory response induced by mycoplasma may be important in the potentiation of PRRS-induced pneumonia," declares Thacker.

Mycoplasma Is Elusive PRRS is a tough organism to control because it mutates so easily. But mycoplasmal pneumonia is tough from several aspects.

It is tough to see in the live pig because the infection takes weeks to develop and provides few signs of infection other than a nagging cough. On slaughter check, most if not all of the lung lesions may have resolved.

The bacteria is extremely tough to grow in culture in the laboratory, and by the time you have cultured them, they may well have changed and lost some of their virulence, explains Thacker. Also, the mechanism by which mycoplasmal pneumonia produces an infection in the pig is unknown. A laboratory study is being developed to mimic infection by growing cells in culture and adding mycoplasma to them, she points out.

For Thacker's trials at VMRI's research facilities at Ames, IA, specific-pathogen-free pigs are purchased and then are experimentally infected. In the fie ld, the dual infection of mycoplasma and PRRS doesn't produce dramatic outward results, but drags down performance and drags out the infection because protective antibodies wane at different times, leaving different groups of pigs susceptible at different periods of time.

The most noticeable signs of the dual infection in Thacker's research groups include that of poor-doing pigs that are gaunt, have great difficulty breathing and don't eat much. Stress them or attempt to move them and breathing becomes very labored.

Of course, points out Thacker, most commercial grow-finish hogs carry around more than just those two organisms. They become infected with a host of viral and bacterial infections that interact, which have been known to kill 100-lb. pigs. Those that survive perform very poorly.

Thacker suggests that this deadly interaction is the result of the development of the PRRS virus, increased concentration of pork production and poor environment as hog buildings in the industry age.

But Thacker's research suggests the key ingredient in the PRDC mix may be mycoplasma.

If your grow-finish herd is performing poorly and you'd like to have it checked, select a group of 120-pounders and deliver them live to a diagnostic laboratory. She stresses the hogs must arrive alive in order to culture them for mycoplasma.

Vaccination Precautions Mycoplasmal pneumonia vaccines don't protect herds from infection, just the expression of clinical signs; they often help restore grow-finish performance, says Thacker, an immunologist.

However, vaccination failure in the field is frequently observed even though studies conducted at ISU by Thacker have found vaccines to be very effective against experimental challenge.

Most commercial mycoplasma vaccines are labeled for administration at 1 and 3 weeks of age in piglets. The problem is that research has shown that the presence of passive immunity at those recommended times of vaccination can reduce vaccine effectiveness, according to co-investigator Brad Thacker, DVM, also of ISU's VMRI. Pat Halbur, DVM, ISU Diagnostic Laboratory collaborated.

In a presentation at the IPVS meeting in England, Brad Thacker explained that his research protocol for the vaccination trial consisted of vaccinating sows twice, at 5 and 2 weeks before farrowing. Pigs from those litters were allotted to three groups. Group 1 was vaccinated at 11-15 and 25-29 days of age. Group 2 was vaccinated at 25-29 days and 39-43 days of age. Group 3 pigs were not vaccinated and served as controls.

It appears that the amount of antibody produced by vaccination was reduced when pigs had passive immunity at the time of vaccination, he concludes. These results have been confirmed in a follow-up study.

Some producers are compensating for this dilemma by changing the times they vaccinate their pigs for mycoplasma, says Eileen Thacker. There are many time options, but she says a number of producers she has consulted with are switching to vaccination of pigs when they leave the nursery and giving the second shot when they leave the grower.

To determine the best time to vaccinate, producers should blood-test their pigs. Because the duration of maternal antibodies varies from farm to farm, she recommends producers bleed a group of 30, 2-4-week-old piglets from across several parities of sows to find out what kind of passive immunity there is in your individual herd.

If producers keep in tune with industry trends and turn over their sow herd at a clip of 40% or more, their sow herd will be very young. This means that maternal antibody levels will be much higher because the females are closer to vaccination and closer to infection.

Old sows, on the other hand, will actually go seronegative. "They still have the mycoplasma, it's just that the protective levels of antibodies are virtually gone, so their pigs may not have any maternal antibodies, or they will be very low," observes Eileen Thacker.

A herd profile helps make an educated guess of what would probably be the best time to vaccinate pigs for mycoplasma. She advises the first vaccination should probably be given just before maternal antibodies wane and the second given 2-4 weeks later.

Because of the rise in severity of mycoplasmal pneumonia, she theorizes that the industry will need to develop better vaccines that more directly target the local site of infection in lung tissues.

"But I have the feeling that in order to manage mycoplasmal pneumonia, ultimately, it will probably take both vaccine and antibiotic therapies, strategically placed," she comments.

Current injectable vaccines for mycoplasma are bacterins, developed by killing the organism and reformulating it into a product that can be administered either subcutaneously or intramuscularly, says Eileen Thacker.

What's needed is the development of a vaccine that can protect against the stronger challenge presented by today's mycoplasma, while not overwhelming the pig, she asserts.

But even before that is achieved, Eileen Thacker is already planning to do research on the other important co-infection pair in PRDC - mycoplasma and SIV.

Seeking Clues To Salmonella

Intensive research on salmonella in hog operations is beginning to unveil some clues about the disease.

Thomas Blaha, DVM, University of Minnesota, spearheads an ambitious salmonella research project involving 25 Minnesota hog farms. About 11,000 samples have been tested for salmonella in the multi-year project. The samples include 4,500 hog lymph nodes and 6,500 tests on the farm environment.

Results from the sampling show 10% of all the environmental samples (outside the barns, rodents, boots, etc.) were positive for salmonella. Surprisingly, only 5% of the hogs turned out to be salmonella positive.

"It is possible to have positive farms and negative pigs," Blaha states. "The producers apparently are doing something to keep those pigs from being salmonella positive."

He intends to look more closely at the theory that working procedures may be more important than the salmonella status of the hog farm.

Basically, the focus of the salmonella research is on all salmonella infection found on the farm, not just the kind that makes hogs sick. In fact, the vast number of salmonella infections found does not affect hogs, but has potential to affect humans.

Blaha and his fellow researchers are studying salmonella in hopes of learning how to reduce salmonella prevalence on the farm. This in turn will make pork safer in the food chain.

Salmonella Drops In Pork Pork producers need to be concerned about salmonella contamination today. USDA has stepped up their efforts to improve food safety. Salmonella, one of the most common food-borne pathogens, is a priority. USDA wants the entire food chain to reduce salmonella contamination.

USDA focused on meat and poultry processors first for improving food safety. Most packers must now operate a HACCP (Hazard Analysis and Critical Control Points) program. HACCP is designed to pinpoint where food contamination occurs and eliminate it.

Early government figures show HACCP programs are successful in reducing salmonella. Salmonella contamination of pork has dropped from 8.7% to 5.5% in 300 of the largest poultry and meat processing plants. Poultry also has dropped from 20% prevalence in broiler chickens to 10.4%. These drops in contamination rates occurred over a six-month period.

Farm Focus As the processors reduce their salmonella contamination rates, the focus will shift to the farm. Blaha hopes research will provide clues to develop good salmonella prevention plans.

Initial results from the research reveal some interesting findings. They are:

* Management procedures and practices have a significant impact on salmonella. Blaha suggests that daily working procedures and practices affect this. Maybe such things as animal movement, removal of spilled feed, and the cleaning and disinfecting of the environment including the hallways joining facilities plays a role in salmonella's spread. The movement of people and animals between areas also may have a great influence on salmonella.

* Dust is cited as a frequent source of salmonella. Blaha says dust makes a great medium for salmonella pathogens.

* Areas and farms appear to have their own salmonella patterns. The testing showed certain strains of salmonella were prevalent on certain farms. Even the strains between the environment and animals were somewhat different.

For example, Blaha says one strain of salmonella was isolated from just one farm. Most of the contamination was found in the environment and only some in animals on that farm.

On another farm, a different strain of salmonella was isolated. This strain, too, was prevalent in the environment, and less prevalent in the animals. Future Research

Blaha plans to continue the investigation into salmonella contamination. One focus of the research is on ways to quickly identify salmonella-infected areas on the farm. Hopefully, that will then lead to ways of cutting contamination of hogs, which in turn reduces the risk of contaminated slaughter facilities.