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National Hog Farmer Weekly Preview
July 12, 2010
 
In this issue:
  GIPSA Rule Creates Law of Unintended Consequences
  Performance by Weaning Age Continued
  Producers, Industry Want Extension on GIPSA Rule Comments
  Coalition Calls for Fast Action On Free Trade Agreements

MARKET PREVIEW
GIPSA Rule Creates Law of Unintended Consequences
The USDA Grain Inspection, Packers and Stockyards Administration (GIPSA) proposed rule aimed at “leveling the playing field,” which was published on June 22, is a potential can of worms for pork producers, growers and packers. That is not to say that some among these groups will not benefit from the rules should they become final. But the rules appear aimed at other species and, by and large, are solutions looking for problems in the pork industry.

In a nutshell, these rules will remove flexibility and add to the cost of doing business with production contracts and/or marketing contracts. But I am confident that the result will not be a rush back into negotiated trades and small farms.

On the contrary, the primary impact will be to drive vertical integration by growers backwards into owning production facilities and backwards by packers into owning a higher proportion of their production. And if that happens, my bet is that the next set of regulations will be aimed at reversing vertical integration.

The law of unintended consequences will reign supreme.

The genesis of this rule is two-fold. First, the 2008 Farm Bill required GIPSA to promulgate rules that establish criteria that the secretary of agriculture would consider to determine:

    • Whether an undue or unreasonable preference has occurred under Section 202 of the Packers and Stockyards Act;

    • Whether live poultry dealers have provided reasonable notice to growers of any suspension of the delivery of birds under a growing contract;

    • When a requirement of additional capital investments over the life of a swine or poultry production contract constitutes a violation of the Act;

    FULL ARTICLE

PRODUCTION PREVIEW
Performance by Weaning Age Continued
Building on the impact of weaning age on other, select performance parameters discussed last week, let’s take a look at weaning age effects on wean-to-first service interval, farrowing rate, farrow-to-farrow interval and female death loss.

Since we get data from over 20 different sow recordkeeping programs, there is some question about how various programs handle and record nurse sows, partial weans and crossfostering. Each farm needs to review how their sow record program calculates weaning age of pigs at their farm.

The information in Table 1 shows data from 686 farms with 1,211,000 females that are producing at 20+ pigs weaned/mated female/year (PW/MF/Y). The accompanying data (Charts 1-15) are sorted by weaning ages: less than 18 days of age (70 farms), 18 days of age (126 farms), 19 days of age (172 farms), 20 days of age (163 farms), 21 days of age (72 farms), 22-23 days of age (57 farms) and 24+ days of age (26 farms). We have summarized four areas that are then broken down as follows: Average Top 10%, Top 25%, Top 50%, All, Bottom 50% and Bottom 50% based on PW/MF/Y.

Chart 1 shows wean-to-first service interval decreasing as weaning age increases, but it is not a linear progression. The average of all farms ranged from 7.48 days for the farms weaning under 18 days of age to 6.60 for farms weaning over 24 days of age – a 12% improvement.

FULL ARTICLE

LEGISLATIVE PREVIEW
Producers, Industry Want Extension on GIPSA Rule Comments
Producer and industry groups have requested an extension of the comment period regarding the proposed USDA Grain Inspection, Packers and Stockyards Administration (GIPSA) livestock procurement rule. The groups indicated that the proposed rule would result in significant changes in how livestock are marketed and procured by meat packers. The National Pork Producers Council (NPPC), in its request for an additional 120 days for comment said, “The proposed rule goes well beyond the parameters set out in the (2008) farm bill, specifically with regard to sections on unfairness, purchasing practices, contracts, competitive injury and recordkeeping. Our initial reading of the proposed rule is that it is overly broad and very vague. We need more than 60 days to determine all of the ramifications this regulation could have on America’s 67,000 pork producers.” The American Meat Institute (AMI) indicated in its request for additional time, “The agency has taken almost two years to develop and publish this proposed rule, which would have a highly restrictive impact on how livestock is procured in the United States. Because of the breadth of the proposal and the impact it almost certainly would have on how packers and producers interact, the proposed rules warrant careful scrutiny, analysis and the submission of comprehensive comments.” Others who asked for an extension of the comment period included National Cattlemen’s Beef Association, National Chicken Council, National Meat Association and the National Turkey Federation.

Agriculture Appropriations for 2011 — The House Agriculture Appropriations Subcommittee has marked-up the fiscal year 2011 agriculture appropriations bill. The bill includes $23 billion in discretionary funds, which is $27 million below the administration’s request. Key areas highlighted by the subcommittee include:

FULL ARTICLE

NEWS FLASH
Coalition Calls for Fast Action On Free Trade Agreements
An ad hoc coalition of agricultural and food groups have sent a letter to Congress urging congressional members to work with the Obama administration to eliminate any barriers to a “rapid implementation” of the free trade agreements with Columbia, Panama and South Korea.

President Obama at the recent G20 Summit in Toronto announced a November deadline for dealing with remaining obstacles to the implementation of the U.S.-Korea Free Trade Agreement (FTA) to gain congressional passage of the pact in 2011.

The agreement with Korea and the FTAs with Columbia and Panama were finalized more than three years ago, and approved in those countries, but still await action by Congress.

FULL ARTICLE

PORK INDUSTRY CALENDAR
July 18-21, 2010: 21st International Pig Veterinary Society Congress, Vancouver Convention and Exhibition Centre,
Vancouver, British Columbia, Canada;
For more information contact: (604) 688-9655 ext. 2 or ipvs2010@advance-group.com or go to http://www.ipvs2010.com/.

August 31, 2010: 20th Annual Carthage Veterinary Service, Ltd. Swine Conference, Western Illinois University
Macomb, IL
For more information contact: (217) 357-2811 or go to www.hogvet.com.


August 31-Sep. 2, 2010: Feet First Sow Lameness Symposium, Hilton Minneapolis
Minneapolis, MN
For more information contact: (612)-376-1000 or go to www.zinpro.com/feetfirst.

FULL ARTICLE
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 BLUEPRINT

As positive margins return to pork producers’ ledgers, owners and managers are recounting the hard lessons learned as they redouble efforts to improve risk management skills, measure and manage production variance with greater precision, and produce quality pork in a safe and sustainable manner. At the heart of the 50th edition in the Blueprint series, published April 15th, 2010, is a focus on new and improved pathways to profitability.

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 MAGAZINE HIGHLIGHTS

The May 15 edition of the National Hog Farmer will feature the fifth class of the “Masters of the Pork Industry,” featuring personal and professional profiles of industry entrepreneurs destined to leave their mark on the North American pork industry. This special edition also features 21 products nominated for the National Hog Farmer’s World Pork Expo New Product tour and a full slate of WPX events and activities.

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NPPC and the National Pork Board have launched a program, We Care, to promote pork producers' commitment to responsible pork production. From animal care and the environment to food safety and quality, pork producers demonstrate best practices daily. For more on continuing the tradition of doing what’s right, Click here


 POSTERS

FREE SELECTION GUIDES AND MANAGEMENT POSTERS
National Hog Farmer offers 10 posters targeting key production areas, offering guidance in critical areas such as feet and leg soundness and reproduction traits soundness in replacement gilts. Others include pig anatomy, heat detection, sow condition, etc. All posters are in English. Select posters are translated to Spanish, Chinese and Japanese.

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