By MEGGIE I. FOSTER
Assistant Editor WASHINGTON, D.C. — With growing consumer concern of U.S. animal agriculture production, the Hormel Foods Corp. announced that they will require all hog producers who want to sell pork to their company to be certified in the Pork Quality Assurance (PQA) Plus program.
The PQA program is managed by the National Pork Producers Council (NPPC) and is designed to educate and train producers and their employees in responsible management and on-farm production practices.
Starting Jan. 1, 2010, Hormel will require producers from whom it purchases hogs to be PQA Plus-certified. The company already requires producers, their employees and individuals who transport hogs to Hormel facilities to have certification in the Transport Quality Assurance program, which teaches proper care and handling of hogs during movement from the farm to packing plant.
“Hormel’s action is welcomed and greatly appreciated,” said NPPC President Bryan Black, a pork producer from Canal Winchester, Ohio. “All pork producers should be certified in the PQA Plus and TQA programs because providing proper care and handling of pigs at every stage of production is the right thing to do.”
According to Black, PQA Plus is the latest effort by the National Pork Board to inform producers about animal care practices and food safety issues. Certification consists of education and training and an on-farm site evaluation. Producers also are subject to a third-party evaluation of their sites.
One of the first companies to support the original PQA program by requiring its pork suppliers to participate in it, Hormel also announced its support for the U.S. pork industry’s new “We Care” responsible pork initiative, a component of PQA Plus that was developed by the National Pork Board and NPPC. We Care includes a series of ethical principles producers are asked to follow, including producing safe food, protecting animal well-being, respecting the environment, contributing to communities and protecting public health.
“Pork producers and the pork industry have been dedicated to maintaining and enhancing the quality of pork production for decades,” said Dallas Hockman, NPPC vice president for industry relations. “Hormel’s support for the ‘We Care’ initiative and for PQA Plus and TQA gives weight to the industry’s efforts to produce safe, wholesome, nutritious pork.”
2009 hog outlook Despite the increased requirements in animal care and production, hog producers are still looking into 2009 with a modest profit outlook, depending upon the varied costs of production, according to Chris Hurt, a Purdue University Extension marketing specialist.
“The industry has had six consecutive quarters of losses from the final quarter of 2007 through the first quarter of 2009,” said Hurt. “The return to profits sometime this winter is predicated on controlling corn and soybean meal costs and keeping the size of the breeding herd down.
“While producers have some optimism of getting back in the black, they do not want to turn any optimism into breeding herd expansion. Plus, the year of 2009 holds continued uncertainties as the pork industry is caught up in both feed price adjustments and a world economic slowdown.”
Hurt said that many of the problems the industry is experiencing are occurring because the U.S. breeding herd has been in a period of reduction during the last half of 2008.
“Prospects for a return to profits are based upon some moderation in feed prices from record levels in 2008 and to somewhat higher hog prices as pork production drops about 1 to 2 percent in 2009,” he said.
Hog producers continued to reduce the size of the breeding and market herd by 2 percent, according to the USDA’s December inventory report. The breeding herd has been below year-previous levels since June 2008.
“More importantly, fall farrowings were down 6 percent and winter and spring intentions are reduced 2 to 3 percent,” he said. “The related pig crops are not down as much because the number of pigs per litter continues to set new records.
“Pigs per litter for 2008 increased to 9.4, or by 2 percent, the largest annual increase since 1996. As a result, the pig crop for the past fall was only down 4 percent.”
Live hog prices are expected to average about $51 in 2009 compared to $48 last year. Prices should rise sharply from the first of the year into spring. Prices are expected to average about $47 in the first quarter and then move to the low to mid-$50s in the second and third quarters.
“Costs of production in 2009 will again hold an important key to whether the industry has profits or losses,” said Hurt. “Using corn and soybean meal futures prices on Jan. 5 and adjusting them to expected cash prices, suggests that costs of production may decline by $3 to $4 per live cwt. in 2009. This assumes that 2009 corn prices are down about 60 cents per bushel and soybean meal is about $25 per ton lower.”
In 2008, estimated cost for average farrow-to-finish producers was near $53 per live cwt. with prices about $48, resulting in losses of about $5 per cwt. or near $15 per head.
“For 2009, costs are expected to be near $50 with prices about $51, for profits of $1 per live cwt. or about $3 per head,” he said. |
