Pork Commentary, October 19th, 2020
Jim Long, President-CEO, Genesus Inc.
Successful Farming yearly does a list of the Top 40 swine producers in the U.S. It’s a regional survey compared to the Global Mega Producer list that Genesus sponsors which covers the world.
What we found interesting in this year’s U.S. Powerhouses list is the decrease of the total sows by 61,475. We expect this is the first time the list has decreased since it has begun. The 61,475 decrease also doesn’t include the 55,000 Maxwell Foods is liquidating as their name wasn’t included in the 2020 list although they were on the 2019 one.
The USDA on the September 1st USDA Hogs and Pigs Report indicated the U.S. sow herd expanded last quarter. We totally disagree. We believe the herd has decreased. The drop in the Pork Powerhouses sow numbers is another example of what has happened to our industry. Financial losses cut inventory, big doesn’t make you immune from the realities of the marketplace.
Of note U.S. sow slaughter continue to run at liquidation levels, over 65,000 a week. A few weeks over break-even in finishing hogs gives help and some hope, but not filling the massive hole created by the pandemic debacle.
Thanks for the feedback last week in regards to our commentary on Certified Duroc. Your comments supported our belief that greater Domestic Pork Demand can be unleashed by producing pork that meets and exceeds consumers’ taste and flavor. It will be a challenge but as pork producers we are used to challenge. As an industry we need to put the marketing disaster of “The Other White Meat” program behind us and focus growing domestic per capita consumption. Ford move on from Edsel, we need to move on from “The Other White Meat” program.
“Failure is simply the opportunity to begin again, this time more intelligently.” – Henry Ford
An example of the mindset of our industry that we have to overcome was a discussion last week with a U.S Packer representative. He explained that they sort the best pork for Japanese Export (Best pork is redder and more marbling). They then do another sort for some foodservice. The leftovers go to the U.S. domestic market.
This mindset will never increase domestic consumption. What other business knowingly send lower quality product to its major customer? It’s like U.S. consumers are second class citizens. Maybe if the best pork is redder pork and has more marbling, we should figure out how to have more of that type of pork to grow demand. Would it be a Common Sense Revolution producing a product that meets consumers demand for taste and flavor, more domestic demand will increase producer profits.
To clarify from some questions we had last week re qualification for Certified Duroc Program. You must use an NSR registered Duroc boar to legally use Certified Duroc Label. We were asked if this precludes PIC and DNA Durocs from label use. Some had been told by PIC and DNA that there Durocs would soon qualify, indeed there were efforts to have rules that would have allowed their participation. It’s obvious the success of the Certified Angus Beef program has swine genetic companies wanting rules diluted so they could be part of Certified Duroc. In the end the breeders of NSR reconfirmed that only NSR registered Durocs qualify for use in the Certified Duroc Program.
Durocs that cannot prove they have a purebred history will not, Mongrel Durocs will not. PIC and the like will be able to join if and when they have a purebred registered Duroc in NSR. Genesus produces Globally 83,000 registered purebred Durocs annually. We believe that to be a true Duroc it needs to have the lineage proof that registered Durocs program affirms. Many Durocs of breeding companies are not pure but synthetic lines with other breeds mixed in. Of the world’s major Genetic Companies only Genesus has a program for all breeds that affirms registered purebred breeding stock. To reiterate to be part of the Certified Duroc Brand you must use an NSR registered Duroc.
“If you are not a brand, you are a commodity.” –Philip Kotler