With economic headwinds projected to linger into 2027, producers must find ways to stretch working capital. However, top production managers and veterinarians warn against arbitrary cuts that erode long-term health and efficiency.
1. DO: Prepare for cyclical downturns without panic.
What are top-tier pork producers doing to prepare for a challenging year ahead?
“When I think of top-tier producers, that doesn’t necessarily just mean big,” says Brad Eckberg, account executive for North America Swine with MTech Systems, during the recent State of the Pork Industry Report. “One of the things they focus on, regardless of size, is keeping their debt-to-equity ratios healthy. Make sure your capital and equity are there if you need it.”
While the last couple of years have had some good moments, it was tough before that, he adds. Pork producers had to build equity back up and that is just now allowing them to make some investments to improve their operations.
“I consider Hord Family Farms to be a top-tier producer and as you shared recently, they are investing their money into filtration on sow farms,” Eckberg notes. “There’s another pretty large producer here in Minnesota that’s incorporating filtration for the first time. Another producer told me they are invested some of their capital into technology to get better visibility to lower mortality in their barns.”
2. DO: Look at low-hanging fruit in feed and inventory.
“We’re not all doom and gloom yet about 2027,” says Randy Kuker, director of livestock operations for The Equity. “Yes, feed costs and the cost of corn have gone up. So, use it as a reminder to pay attention to feeder settings. Make sure you are not wasting feed – keep feeder settings tight, but not too tight. We evaluate settings on a weekly basis.”
Another thing his company looks at is adjusting levels of corn in the diet and swapping them out with cheaper ingredients when it makes sense.
“In our mills, we do feed some alternative ingredients, and we can adjust those levels based off of what corn price is,” Kuker says.
He also recommends re-evaluating nursery diets.
“Your nursery stage one diet is usually one of your most expensive diets,” he says. “If you’re used to getting an 11-lb. pig, and all of a sudden you’ve got a sow farm that’s giving you a 14-lb. pig, there’s an opportunity there to adjust and feed less of that expensive ration and try to start them out on the next stage diet if you have a high health pig that doesn’t have enteric issues.”
In the sow barn, Adam Annegers, sow production manager at JBS, suggests keeping a tight supply inventory in the barn.
“Of course we need to provide everything that our employees need to do their job, but now is not the time to have excess amounts of products sitting on the shelf,” Annegers says. “It’s surprising how quick supplies will increase the cost over time just sitting there.”
He also encourages producers to feed sows to the proper body condition to avoid overfeeding or underfeeding. One of the big messages he shares with his team now is to be efficient with their resources.
3. DON’T: Cut down on herd health protocols to pinch a few pennies.
Cutting baseline herd health protocols during tough times is a false economy, says Dr. Cara Haden, director of animal welfare and biosecurity with Pipestone. She says there are two non-negotiables when budgets are tight.
“The first non-negotiables are your basic vaccinations,” Haden says. “Circovirus is a ubiquitous pathogen. We should never quit vaccinating for circovirus or porcine reproductive and respiratory syndrome (PRRS). There’s a lot of good work that shows these vaccines reduce the clinical impact of disease, so that’s not something we want to skip to save money, especially going into the winter time.”
Oftentimes when pigs get sick, she points out that producers want to run an antibiotic and an anti-inflammatory. When times are tough and producers are trying to make cost decisions, sometimes the anti-inflammatory gets pulled.
“I would encourage producers that PRRS, influenza, and a lot of the diseases we deal with, cause high fevers that result in inflammation,” Haden says. “If we want to get these animals back on feed and water, we need to get that fever reduced. We need to get those pigs feeling better. I’ve had influenza in my life. I’ve had strep throat. The anti-inflammatory is the thing that gave me comfort to keep moving on.”
While producers cannot control feed ingredient markets, macroeconomic cycles, or packing plant margins, they can control daily barn execution. Weathering the next margin squeeze won’t come from sweeping, indiscriminate budget cuts, but from dialing in the small efficiencies like tightening feeders, balancing inventories, and aggressively protecting the herd health that keeps full-value pigs moving out the door.
