National Pork Industry Conference Report
Last week we attended the National Pork Industry Conference (NPIC) held at Kalahari Resort, Wisconsin Dells, Wisconsin. Their were approximately 950 registrants for the four day conference. NPIC had many speakers and events. Our observations:
Sunday night kicked off with the excellent Barbecue prepared by Lynch Livestock. This was followed by the Genesus Reception which was jammed with people that went to 1 am. We appreciate all that attended and from the participation and interaction we saw all had fun.
First speaker Monday morning was Ken Maschoff, of Maschoff Family Foods and current President of the National Pork Producers Council. Maschoff spoke of his family legacy starting with he and brothers first pig barns being buit when they were 20. His fathers unilateral action to make his sons the decision makers at that time. The legacy of building massive swine operation and diversifying into other non ag related businesses. A Horatio Alger story shared by Ken, his wife Julie, his brother, his father and all the their families. Maschoff Family Foods as with the name family sums up the picture Ken pointed of their company and their legacy.
Ken in his talk displayed the National Hog Farmer – Genesus Global Mega Producer list. Maschoff are number nine globally with 218,000 sows. Ken was obviously proud of his families global mega producer ranking, they should be, long way from the first barn not so long ago.
One of the main themes of the conference was antibiotics and pork. It was somewhat obsessive the number of speakers who talked about this. We are not sure that this is the driver that will endure pork consumption. Antibiotic free is expensive to produce and needs to sell for more money. The whole carcass costs more but often other then Loins not many other cuts have consumers caring ie. Bacon, Ribs. There is a percentage of consumers that will pay more, but how much pork will they buy? Seems the Conference spent a lot of time talking about 5% of the market. First off, Export markets have next to no demand for antibiotic free pork that means 30% plus of all US-Canada production. Second, all pork is antibiotic free when it reaches the consumer; withdrawal ties mandate no antibiotic resides in pork. If its not there is it not antibiotic free? We are walking ourselves up a slippery slope pork making antibiotic free a marketing plan inferring other pork isn’t safe. We realize there is a market for antibiotic free but we remember the Vice President of Seaboard – Triumph who spoke last year at NPICand said they were happy to focus on 95% of the Pork market.
What we don’t get is why the reality of the Pork Cut out continues to be a non topic, Bellies, Ribs, Shoulders all marbled pork, better flavor better taste lead the cut out values. While loins and Hams languish. Reality is slapping us in the face foolish quest for lean pork has destroyed the value of over half the carcass (loins-hams) price reflects real demand Bellies, Ribs, Shoulders lead the demand. Consumers vote with their money. Bellies (Bacon) are almost three times the value of Hams. Grade system needs to be revised to reflect markets real demand. Producers need to re-evaluate their thoughts on feed conversion importance and then measure by cost of gain.
Boyd, 2012. Integrating Science into Practice and Getting it Right
1 Agri Stats Inc., March 2011 report
2 Item 9, days to market, not shown but was equivalent for the Average and Top 25%
*Firms that ranked in the Top 25% for profit were more Profitable than firms that ranked in the Top 25% for Low cost in years of profit and loss.
*Ingredient cost ranked higher than Feed Efficiency in differentiating most profitable firms.
Take home message Produce pork with better taste flavor if every American eats Pork one more time a month demand increases 8 million hogs annually. That’s a market driver. It’s a profit driver.
This post was written by Genesus