Line Speed Ruling Will Drastically Reduce Pork Harvest Capacity in Some Regions
After 20 years of testing and science-based modernization, the recent federal district court ruling to strike down a provision of USDA’s New Swine Inspection System (NSIS) is a devastating blow to the swine industry.
This decision, if left unchallenged, will result in a 2.5% loss in pork packing plant capacity nationwide and more than $80 million in reduced income for small U.S. hog farmers, according to Dermot Hayes, an Iowa State University professor of economics.
Terry Wolters, president-elect of the National Pork Producers Council (NPPC), from Pipestone, Minn., told AgriTalk’s host Chip Flory that the loss in pork packing plant capacity will be much higher in some regions.
“The growing concern we have is that we have a plant in Austin, Minn., that is affected by this as well as a plant in Fremont, Neb. In our little corner of the northwest part of the Corn Belt, we've got more like a 20% to 25% impact to those producers,” Wolters said.
He said the regions hardest hit by this decision will be Michigan/Pennsylvania, Minnesota/Nebraska, Iowa/Illinois and Oklahoma.
“There may be some people who hear a slow-down of slaughter capacity by 2.5% and think, ‘So what? That's not much, that shouldn't have a major impact.’ But it does when we're talking about an industry where prices for pork and prices for beef move significantly when the supply or the demand shifts by even less than 1%,” Flory said.
Hayes’ data shows that decrease will result in somewhere between 80,000 to 100,000 head a week that will no longer be able to be harvested in a normal work week.
“In certain areas, a double-shift plant like Austin, Minn., is already harvesting 20 hours a day. They can't harvest any more hours in a given day to make up that difference,” Wolters said. “Their only alternative at that point is to go to Saturdays. Are they really going to ask workers to work six days a week every week to make up that shortfall? I don't see it happening. We're already short workers in this industry.”
The judge's ruling goes into effect at the end of June. Wolters said it’s challenging because you can’t stop the biological process that is already in progress.
“Unfortunately, it feels like we're starting to sense what happened last year – not enough harvest capacity for the pigs that are in the pipeline,” he said. “It’s a huge concern.”
NPPC is urging USDA to appeal the ruling and seek a stay for the appeal consideration, Wolters said.
“We've modernized these plants to handle the line speeds. We're dealing with a rule that's 50 years old, and we don't operate in that technology phase today. We're asking the USDA to seek the stay and appeal the case so we can better address the modernization in these plants,” Wolters said.
The feedback and the data that we've gotten from these plants shows that worker safety has improved, Wolters added, and there are less reportable injuries due to modernization of these plants.
“We definitely think the ruling is misguided,” he said.
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