From giant processors to the farmers who supply them, they are in a predicament largely of their own making. They made production so efficient that demand can’t keep up with supply. U.S. demand for pork is 9% less than what it was 20 years ago, but farmers produce 25% more.
The rise of industrial-scale hog farms, steadily increasing crop yields and growing overseas demand helped supercharge the U.S. pork industry in the late 20th century, and since the 1980s, pork production in the U.S. has doubled. The industry will produce nearly 28 billion pounds of pork this year, cleaved from roughly 125 million hogs.
Pork contributes $57 billion to the U.S. economy and employs 610,000 people. In Iowa, the top pork-producing state, hogs outnumber people nearly 8 to 1. That zeal for efficiency and expansion are a factor in the current troubles. Practically everything that goes into raising hogs is now significantly more expensive: machinery, services, equipment, repairs, building materials, livestock-feed supplements and labor.
In the 1960s and early ’70s, beef was king among American consumers and pork held second place, but chicken overtook pork in 1986 as poultry production skyrocketed, making it the cheapest of the big three meats. By 1993, chicken became the most-eaten meat in America. Religious prohibitions in Judaism and Islam limit pork’s popularity, along with a sense among some that pigs are too smart to slaughter. On the other hand, some consumers are more passionate about their love for bacon than any other meat.
So American pork producers increasingly bank on consumers in other countries. The industry exports 25% to 30% of product. Sales to China, the world’s top pork-eating nation, surged following a hog-disease outbreak in the country in 2018. Producers in the U.S. responded by expanding capacity even further, with new processing plants in Iowa and Michigan. Chinese pork producers rebuilt their herds, however, and exports to the country have plummeted over the past two years, contributing to U.S. oversupply and pressuring meatpackers’ profits.
Classroom discussion questions:
- What options do pork producers have? (Hint: see Supp. 7 in your Heizer/Render/Munson text on page 308)
- How has technology played a role in the imbalance?