Hog operations are larger and more specialised
Structural change in US hog production in the last 20
years has had profound effects on industry performance and on strategies for
dealing with change, according to a report by the USDA's Economic Research
By making major adjustments to the size, organisational structure, and
technological base of their operations, hog producers have succeeded in
increasing productivity and reducing costs. Such adjustments have ultimately
resulted in lower pork prices for food processors and consumers.
On the downside, however, concentrated hog production has imposed
environmental risks on nearby communities and concerns about food safety and
animal welfare issues have come to the fore.
Consolidation means that fewer and larger operations account for an
increasing share of total output. The figures show a 50% drop in the number of
hog operations in the last two decades, while average production from these
operations grew between 1992 and 2004 fivefold to 4,646 head.
Traditional farrow-to-finish hog
production has been replaced by single production operations. Specialised hog
finishing operations accounted for 40% of hog operations in 2004, an increase of
19% from 1992.
7% of operations in 2004 were operations specialising in farrowing and
Much of the growth in production from specialised hog operations came from
contracting. Production from hog operations using contracts (between growers and
hog owners) grew from 5% of the total in 1992 to 67% in 2004.
Considerable productivity gains have accompanied this structural change.
Current trends of specialisation are set to continue to shape the future of hog
production in the US.
â€¢ USDA ERS
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