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Hope for Pork Profitability in 2024 is Fading

Tue, 04 Jun 2024 23:55:31 GMT

U.S. pork producers just came off the worst 18 months of negative profit margins in history, even 1998. There was optimism when hog futures rallied to contract highs at around $110 this spring that 2024 would be a more profitable year. However, that hope has faded.

Pork margins started off 2024 in the black, but spring and summer month hog futures have set back $15 to $17 from the contract highs set in mid-April.

Steve Meyer, senior livestock economist, Ever.Ag Insights, says cash and cutouts just stalled the last six weeks, pulling down the lean hog futures and cutting into break evens and profit levels.

“It has gotten progressively worse since March,” he says. “Back in March, the model I have - which is based on historical Iowa State University estimated costs and returns - had about $10 per head, and that’s for probably the low cost 25% of producers which I think the Iowa State model really represents. So, that was about $10 per head back in March. That model last week had minus $4, and it’s mainly been a reduction on the revenue side because of the selloff we’ve seen on the lean hog futures market.”

Meyer says the cost of production has also increased.

“We had about $85 in that cost model back in March and almost $88 now. So, the uncertainty of getting this crop planted has kind of put a little fuel on the corn and soybean markets and cost us some,” he says.

Cash and the Lean Hog Index have also stagnated as pork cutouts have been flat during April and May. Meyer says cutouts usually stage a seasonal rally of $6 to $8 in the spring. So, it’s not tied to hogs supplies but instead soft demand.

“Export demand has still been pretty good, so I don’t think that’s where it is,” Meyer explains. “If we look at the real per capita expenditures, pork real capita expenditures are down almost 5% year to date through March. That tells us that the softness we see is on the consumer side in the United States.”

He’s concerned about the slower demand with supplies ramping up into 4th quarter as weekly hog slaughter pushes over 2.7 million head and squeezes processing capacity.

This could mean additional pressure on cash and wholesale pork values ahead.

Barn Hero Alma Valdez: 'Success is Never Just Your Success'

Wed, 15 May 2024 18:14:01 GMT

The breathtaking views of Guanajuato, Mexico, weren’t easy to leave behind, but Ma Merced Yebra knew her children deserved better than what she could provide them there. Although her husband went to the U.S. often to find work, he never saved enough to help his family back in Mexico. One day she decided to take a chance on a new life in the U.S., leaving behind her roots and venturing into the unknown with her four young children.

“We didn’t have a lot growing up,” says Alma Valdez, her youngest daughter. “We were very poor. We lived in a house made of cardboard and metal sheets. We struggled a lot. My mother’s decision to leave her home in Guanajuato to come to the U.S. changed my life completely.”

This journey led them to DeKalb, Ill. At the age of 8, Valdez turned all her focus to learning English — fast. Unfortunately, very few teachers knew Spanish at the time, so it made it difficult for her to learn.

“I guess that’s where I started learning to not give up, to always try to see the best in people and to learn from everyone,” she adds.

With time, she picked up English and found herself translating for her family. Her mom took a job at a pig farm. When Valdez turned 18, she started working at the farm with her mother as a part-time power washer a few days each week. Not long after that, she began translating educational materials from English into Spanish to help other employees. Valdez says that’s how she learned how to castrate, how to care for sows, how to heat check and more.

She kept saying yes to new opportunities. She worked her way up the ranks and found herself in a manager role, taking care of the barn and the crew. Valdez moved to Minnesota to gain even more experience. A couple years later, a local veterinarian approached her to apply for a job back in DeKalb at Johnson Farms.

Her inspiring journey moving up from power washing farrowing rooms to managing a sow farm makes Valdez a barn hero in the eyes of everyone who works with her, says Cole Johnson, co-owner of Johnson Farms.

“She has a unique ability to earn credibility with people,” he adds. “When it comes to leading a crew in the barn, she’s been where they are. She will never ask anyone to do something she has not already done or is willing to jump in and try alongside them.”

The Right People in the Right Spots

When Valdez went to work for Johnson Farms a few years ago, she admits it was a little overwhelming at first.

“There was a lot of work to be done,” Valdez explains. “But that’s also what made it exciting.”

She says learning how to use new technologies at the farm such as e-tagging and electronic sow feeding made her job even more interesting. She was also eager to help get the farm more organized and build a more cohesive team.

“I think the frustrating part was not being able to be in all the places that I wanted to be in the short amount of time that I had throughout the day. As soon as I’d fix something in one spot, another area needed my attention,” Valdez adds.

The never-ending to-do list is one of the many reasons Valdez initially worked for three weeks straight before taking a day off.

“People see she doesn’t take many days off, even though I urge her to do so,” Johnson says. “You can’t come in and just be a dictator, especially when you’re asking people to make a lot of changes. Alma’s understanding that you need to have credibility with people before you can lead them is unique.”

Valdez says this was an intentional decision because she believes leadership requires an understanding of the people you are leading.

“It starts by getting to know the crew, making sure you have the right person in the right spot,” she says. “It’s like they say, ‘put your aces in your places.’ That’s exactly what I do.

When you come into a new barn, you have to find out what everybody has to bring to the table and put them where they fit. Then, you can step back and let them succeed.”

Spending time working alongside her team allows her to know what team members need to improve upon, while also helping her learn what she can improve upon by watching them, too.

“They need to know that I’m not just there to boss them around; I’m there to work with them and guide them where needed,” Valdez says. “Earning their trust has been the biggest thing, especially in this industry. Women are not looked upon with high hopes to get stuff done as a man would in this role.”

Caring for pigs should never be just about earning a paycheck, she says. Her goal is to build a team that truly cares about what they do in the barn each day, and that starts with her.

“I am nothing without the crew. Everybody has something to offer the farm,” she says. “And when it’s not the right person, they will step away on their own because they will know that they’re not fitting in. When you have a great team, like the one I have right now, it’s never about any one person. It’s about all of us working together.”

The Proof is in the Sow Pen

After a month of her leadership, Johnson noticed a change in the sows.

“Our veterinarian and I were walking the barns and he pointed out how different the sows were behaving,” Johnson says. “They were so much calmer around people — almost indifferent to us as we walked around. That was not always the case before Alma joined us. I attribute that to them getting more individual attention and being around people more.”

Patience and a love for animals is a critical part of being a caregiver, Valdez says.

“You can’t just walk in here and not care for animals,” she says. “When you spend time with them every day, you get close to them. You see them differently. You realize they depend on you to survive. Caregivers need to be willing to go above and beyond to look after the animal, make sure they see each animal individually, and have the desire to ask for help when needed.”

It’s not just the sows who revere Valdez as a barn hero, it’s the people, too.

“When Alma steps into a room, something changes,” Johnson says. “She brings positive energy wherever she goes. I rarely used to hear laughter in the break room. Now, there’s always laughter when I walk in there. She understands the importance of a positive environment and how that seeps down into the care animals get.”

Valdez says starting at the bottom of the ladder power washing made her even hungrier to learn.

“I learned from the good and bad in people around me. I learned what I did and did not want to do. I’ve molded my way up to where I am today, and I feel very proud of that,” she adds.

Of course, it doesn’t hurt that she’s a little competitive, too. She loves finding ways to get tasks done more efficiently and is never afraid to show off her skills in hopes others respond and rise to a higher level.

“No one wants to let the team down,” Johnson says. “Everyone wants to carry their weight. That stems from Alma’s example. She won’t slack off. She never hides behind a desk and does the unpleasant jobs along with her team.”

Understanding that a positive culture starts with her, Valdez chooses to lead by example. She knows that how she acts, how she treats animals, how she treats coworkers, how she responds to challenges, all rub off on her team.

Eusebio Balderrama is one of the team members at Johnson Farms. He appreciates how Valdez always considers everyone’s input when it comes to making decisions on the farm.

“She is not set on doing the same thing because that’s what’s always been done,” Balderrama says. “She always wants to improve the farm. I like to work with her because she is open-minded. Even if we don’t see eye to eye, we always find a way to work together to achieve a better result for the farm.”

Translating Success

Balderrama is one of six employees on Valdez’ team. Most of the employees only speak limited English, so Valdez’ bilingual skills are an asset to the team.

“Playing a translator helps build everyone’s confidence in your role as a leader,” Valdez points out. “Communication is critically important. I always want to make sure that the rest of the team members understand what the other ones are going through. There have been many times I have to sit and translate. We can’t let language be a barrier to doing our job right.”

She really appreciates how her team finds ways to communicate, even when language gets in the way. It’s never an excuse to not get stuff done, she says.

Patience is an important trait to have when leading a team, Valdez says. Being a caretaker is full of challenges that are often out of your control.

“Bad things happen, and it doesn’t help to blame anyone,” she says. “For example, my team watches how I respond to disease breaks. If you act like everything is over and you are overly emotional, they feed off that. I have learned to stay centered, find out what we can do different next time and keep communicating.”

But that’s easier said than done some days, she admits. That’s why she starts by taking care of herself and leaving her problems at home when she comes to work each day.

“Everybody has their issues,” Valdez says. “We try not to bring that stuff to work so we can focus better on our daily tasks. Getting our work done definitely helps us create momentum for the day and find something to be positive about.”

She’s also learned to create space during breaks and at lunch for non-work conversations.

“We all need time to unwind,” she says. “When we come to lunch, I make sure we have a positive experience so we can relieve a little stress. We don’t focus on work — we take a break from it. Just having a moment for each other helps the crew and myself.”

Her leadership style works, Johnson says. She empowers others to do their best and take responsibility.

“Alma knows when to be hands-on and when to take a step back and let the team take ownership of their specific area,” he says. “People appreciate that and feel trusted. It motivates them to take ownership of what they are doing.”

Passing It On

How does it feel to be called a barn hero? Valdez insists she’s just someone who loves what she does every day.

“It’s very rewarding to know that someone outside your barn sees the work you are putting in,” she says. “It’s nice to know that someone else cares about what you’re doing.”

Of all the praise she’s received, one person’s praise has meant the most to her, she admits.

“My son is 15. He didn’t like the idea of me working at a farm because ‘it’s smelly.’ But he started coming to help me on the weekends and noticed the care that I was giving and why I did things the way I did,” she explains.

After training him to do some tasks, her son started to like the job a little, and now he loves it.

“He told me he wants to be a manager like me,” she says. “He says, ‘I want to run a place. I want to be able to have that and know everything about the farm like you do.’ For me to be able to give that hope to my own son, to have that drive and determination to get somewhere, that’s all I could ever ask for,” Valdez says.

That’s her hope, not just for her son, but for everyone she trains and works alongside. She simply wants them to feel proud of what they do, she says.

“One of the biggest things I’ve learned is that your success is never just your success,” Valdez says. “It’s a team effort — I’m just trying to make sure we go in the same direction.”

Read More from the Barn Heroes Series:

Barn Hero Summer Doty: Prioritizing Pig Care

The Front Line Matters

Cattle and Hogs Initially React Negative to USDA Reports, Then Bounce Off Lows: Grains Turn Mixed

Tue, 26 Dec 2023 21:06:15 GMT

Cattle open lower with a negative reaction to the COF report. Was it really that bearish and will weather and higher cash trump it? Hogs react to USDA numbers with a slightly larger inventory. Grains open higher then turn mixed assessing weekend rains in Brazil and seeing end of year positioning. Brad Kooima, Kooima Kooima Varilek, has more.

USDA Quarterly Hogs and Pigs Report Bearish: Shows Nearby Expansion

Fri, 29 Sep 2023 15:58:00 GMT

USDA’s quarterly Hogs and Pigs Report was slightly bearish. All hogs and pigs came in at 100.3%, kept for breeding at 98.8% and kept for marketing at 100.4%. These were all above trade estimates. The June -Aug pig crop came in at 100.4%, pigs per litter at 104%. Farrowings were the bright spot, with June-Aug at 96.3%, Dec-Feb intentions at 98.6%. Mike Minor, with Professional Ag Marketing, has analysis.

U.S. Livestock Producers Look to Latin America as a Growth Area for Red Meat Exports

Thu, 20 Jul 2023 13:21:10 GMT

May pork exports were the highest in two years and that’s partially due to big demand from Latin America. Mexico is the best example with pork exports on a record-breaking pace. However, there is potential for additional export growth in red meat exports in C entral and South America. That’s based on the success the U.S. has had with Mexico and Columbia after signing trade agreements. U.S. livestock producers were just in Columbia with the U.S. Meat Federation meeting with buyers at the Latin American Product Showcase.

Randy Spronk, is a pork producer from Edgerton, Minnesota and Chair-Elect of the U.S. Meat Export Federation: And so, I think it’s one of the great things that we see here with over 475 attendants. You know, you’ve got over 100 importers from Colombia alone. You’ve got 25 countries from Latin America and Central America here so you’ve got a very vibrant exchange going on here with our exporters and the importers into Latin America.”

U.S. livestock producers are hoping to build on the export growth they’ve seen in countries like Columbia. When the U.S. struck the Free Trade Agreement with Columbia over a decade ago sales of U.S. red meat were in the single digits. However, with the FTA and the strong relationship between the two trading partners they’ve seen a big increase in exports. “The most recent data shows it’s about 12 kilograms, which would be close to 25-pound per capita consumption. So, a phenomenal growth in consumption of U.S. pork products within Colombia, but also then our market share within Colombia. And so, it just shows the potential once we open a market and get a free trade agreement. And actually, then over time of developing relationships and exactly what’s going on here today. We do move more product because of the competitiveness of US beef, pork, and lamb producers.”

He says expanding exports in Latin America will also help the U.S. diversify beyond China. “When it comes to meat exports of beef, pork and lamb what we’re really what we’re looking for is diversification of markets. Get the highest value for each one of the primal cuts that we producers in the United States make.”

Spronk says consumers in the Latin American countries like U.S. red meat for many reasons including their price point and sustainability. He says, “It’s really all about our feed products here. It’s all about our corn or soybean products that make up that nutrition that we have here. That’s what really gives us the basic competitiveness here and the cost advantages that we have to other places that are producing red meat in the world here. And so I think it’s the value they’re always looking for you know in their market or the in country market where can they get the best value and a lot of times just because of the U.S. market.

Spronk says their also targeting Latin America because they’re good customers of variety meats, like liver, which aren’t popular in the U.S. So these sales add a tremendous amount to the value of each carcass.

Profit Tracker: Profit Margins Erode For Cattle And Hogs

Fri, 07 Jul 2023 19:15:54 GMT

Cattle and hog finishing margins are both positive for the sixth consecutive week, but margins have eroded significantly.

Cattle feeding margins posted average profits of $20 per head last week, $21 per head less than the previous week and $102 less than a month ago. Cash prices for fed cattle declined nearly $1 per cwt. on average to $103 per cwt., according to the Sterling Beef Profit Tracker .

Cattle marketed last week were purchased last spring at prices diminished significantly by the onset of the coronavirus pandemic. Feeder steer prices factored into last week’s Profit Tracker were $130.83 per cwt., which is $6.86 per cwt. lower than last year. Those lower feeder cattle prices produced an average breakeven of $102.33 for cattle marketed last week. The previous week’s breakeven price was $101.50 per cwt., and a year ago the breakeven was $110.39 per cwt. A year ago cattle feeders lost an average of $40 per head.

Packer margins increased $16 per head last week to $273. Last week’s beef cutout price averaged $205 per cwt., a decline of $1 per cwt.

Feedyard margins reported by the Sterling Profit Tracker, Sterling Marketing, Vale, Ore., are calculated on a cash basis only with no adjustment for risk management practices.

(Note: The Beef and Pork Profit Trackers are intended only as a benchmark for the average cash costs of feeding cattle and hogs.)

Sterling Marketing projects 2020 feedyard margins to average $10 profit per head, while annual packer profits are projected at $314 per head. Cash cow-calf margins for 2020 are projected at $57 per calf.

Farrow-to-finish pork producers have seen their margins improve this fall with rising lean carcass prices. Last week saw average closeouts post $17 per head profits, about $3 per head lower than the previous week, and $7 per head less than a month ago.

Lean hog carcass prices traded at $64.52 per cwt., $1.69 per cwt. less than the previous week. Lean carcass prices are $1.75 per cwt. lower than a month ago, and $13.28 higher than the same week a year ago. A year ago pork producers lost an average of $28 per head.

Pork packers saw average profits of $42 per head last week, down $17 from the previous week.

Sterling Marketing projects 2020 annual per head losses for pork producers at $18 per head, while projected packer profits are $59 per head.

(Editor’s note: Sterling Marketing is a private, independent beef and pork consulting firm not associated with any packing company or livestock feeding enterprise.)

Related stories:

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Profit Tracker: Huge Packer Margins

Fri, 07 Jul 2023 19:15:54 GMT

Feedyard closeouts for the Thanksgiving week were in the black for the 10th consecutive week, according to the Sterling Beef Profit Tracker . Under normal conditions that would be the headline generating observation from the Profit Tracker, but the beef complex continues to defy any resemblance of normal.

Last week beef packers found average profit margins of $519 per head, based on calculations by Sterling Marketing. That was an increase of $75 per head from the previous week, and despite the fact cash fed cattle prices increased $1 per cwt. to an average of $110.

Feedyards found average profits of $88 per head last week, down slightly from the $96 profits the week before. The decline was the result of slightly higher feeder steer prices factored into the calculations. A year ago cattle feeders were earning $108 per head. Feeder cattle represent 69% of the cost of finishing a steer compared with 73% a year ago.

Last week’s beef cutout gained nearly $9 per cwt., and that was after a $10 per cwt. gain the previous week. The result was a cutout price of $240 in the Profit Tracker calculation.

The cost of finishing a steer last week was calculated at $1,407, which is $92 lower than the $1,499 a year ago. The Beef and Pork Profit Trackers are calculated by Sterling Marketing Inc., Vale, Ore.

Farrow-to-finish pork producers saw their margins slop $3 per head to $6 profit. Lean carcass prices traded at $59.37 per cwt., down $0.73 per cwt., $5.15 lower than a month ago. A year ago pork producers lost an average of $41 per head. Pork packer margins averaged a profit of $35 per head last week, up $2 from the previous week.

Sterling Marketing president John Nalivka projects cash profit margins for cow-calf producers in 2020 will average $51 per cow. For feedyards, Nalivka projects an average profit of $10 per head in 2020, and packer margins are projected to average $281 per head.

For farrow-to-finish pork producers, Nalivka projects 2020 will produces losses of $18 per head. Pork packers are projected to earn $48 per head in 2020.

Why You Should Get Out and Attend Pork Industry Events

Mon, 17 Apr 2023 14:45:48 GMT

As an Iowa pork producer, Trish Cook is quick to realize she is fortunate to have many opportunities to talk with her peers at events and meetings nearby. But for Cook, the current president of the Iowa Pork Producers Association, one of the reasons she looks forward to attending the National Pork Industry Forum each year is to grow her circle even wider.

“What’s great about Forum is we have pork producers from across the country all here in one place,” Cook says. “Although our farms don’t look exactly the same, we have a lot of the same common interests.”

She believes it’s critically important that everyone from across the country has input into what the national organizations do with producer dollars. It gives producers the opportunity to visit directly with organization leaders to share their thoughts and concerns to make the industry better.

“It’s really easy to want to stay amongst the people that you know at these events, and coming from Iowa, we have the most delegates here so almost everywhere you turn, there’s somebody from my state. But it’s really awesome to get other perspectives.”

She says networking has helped her better understand the different parts of the industry that she may not be involved in, or methods of production that her farm doesn’t do.
During the 2023 National Pork Industry Forum in Orlando, Cook met a couple from the state of Maine and says it was a highlight of her week to visit with them about their farming operation.

“I enjoyed getting to chat about what their farm is like and how they’re facing challenges every day with different rules and regulations in their state than what we deal with in Iowa,” she says. “They’re finding agritourism to be really popular in their area. They’re not unique in doing that in their state, but it was so exciting for me to talk with them and hear the passion.”

Now she’s following them on Facebook and says she looks forward to growing their friendship.

The National Pork Industry Forum is just one way that producers can grow their network and get more engaged in the industry. Cook says the key is to find ways to get involved.

“We don’t all do things in exactly the same way, but we all have the same passion,” Cook says. “We’re all following the We Care principles and we all really love what we do, or we wouldn’t be doing it.”

Upcoming events you may want to attend:

Plan Now to Celebrate a Milestone Anniversary at 2023 World Pork Expo

Save the Date for Iowa Swine Day

Increasing COVID-19 Cases in China Creates Demand Fear for Markets: But Positive Longer Term

Fri, 06 Jan 2023 17:27:18 GMT

China will reopen the border with Hong Kong on Sunday for the first time in three years, as it accelerates the unwinding of stringent COVID-19 rules. Demand concerns have been intensifying with the spike in COVID-19 numbers in China and the idea the pandemic may worse before it improves. That’s been sending a negative tone across the energy sector, equities and portions of the ag markets.

China’s efforts to normalize their economy by lifting its zero-COVID-19 policy in early December have been met with a sharp increase in COVID-19 hospitalizations and deaths. The World Health Organization received update data from China showing a nearly 50% increase in cases in the week up to Jan. 1.

China’s GDP and other economic data is showing contraction including the December Purchasing managers Index, with the fall in output for the fourth straight month. It’s also negatively effecting energy demand.

Darin Newsom, senior market analyst with Barchart says, “We see most of that playing out in the crude oil market and crude just collapsed to start the year. It kind of stabilized a bit on Thursday, but by and large, that seems to be where everybody gets the most excited if China continues to start up and shut down, start up and shutdown.”

For the ag markets, the China news is bearish short term due to demand concerns and China’s pork price is down 31% for December which backs that up. But it’s also throwing caution on U.S. ag markets like cotton, grains and hogs.

Newsom says, “The big question right now is pork. We’ve got a lot of commercial selling hitting the pork market of late. So, I think that is a concern.”

However, longer term, China easing it’s COVID-19 restrictions after nearly three years in lockdown will translate into demand for goods, including food.

DuWayne Bosse of Bolt Marketing says, “China breaking out of their COVID-19 restrictions is a longer-term story that’s bullish to me. Everyone keeps trying to make it a bearish story short term because of the number of COVID-19 cases increasing. But then getting back to normal like we did, I think people will be out spending money and demand will grow.”

China’s demand for U.S. soybeans and meal has stayed strong throughout the pandemic, especially as the prices for soybeans are near $20 and meal has been near-record highs.

Traders are continuing to monitor the situation and are closely watching the spread of infections during China’s week-long Lunar New Year holiday that begins on January 21. The fear is that may keep the economy from recovering.

USMEF Celebrates Export Relationship with Japan: Looks Ahead to Next 45 Years of Growth

Tue, 27 Sep 2022 19:20:00 GMT

Leaders of the U.S. Meat Export Federation traveled to Tokyo last week to mark the 45th anniversary of their Japan office.

Japan is consistently a top export customer for U.S. beef and pork both by value and volume. That relationship expanded under the U.S. Japan Trade Agreement, which led to meaningful tariff reductions and has greatly increased the value of each beef and pork carcass.

The U.S. has had tremendous success in Japan the past 45 years, but is now looking ahead to the next 45 years and how to further expand this red meat export market, according to USMEF Chairman Mark Swanson, who is also founder of Tru Grit KGMS Enterprises in Fort Collins, Colo.

“We’ve had the wonderful opportunity to visit some retail outlets, see the U.S. product on display in the supermarket chains and learn from our importing customers about the value they see in our product and how we might be able to continue to grow the demand for exports in the market,” Swanson says.

The 45-year relationship has built a loyalty for U.S. red meat in Japan, says Dan Halstrom, USMEF president and CEO.

“It’s not easy to get started in Japan. But once you do, and once you supply what you say you’re going to supply in terms of quality and consistency, the market is very loyal to our supply sources,” he says. “That’s one of the big takeaways, markets go up and down in price, but the Japanese market is always here buying on a consistent basis.”

The Japan market is also highly competitive, and it’s the relationship U.S. farmers have that gives them an advantage, says Dean Meyer, USMEF chair-elect and a livestock and grain producer from Rock Rapids, Iowa.

“There are 20 or 25 countries that want shelf space here, but what differentiates U.S. meat from meat around the world is that it’s safe, reliable and tasty,” he says. “What we’re really pushing now with the campaign is it’s raised on family farms.”

Mayer says that messaging has really attracted the attention of consumers in Japan, and it’s a success they plan to capitalize on.

In 2021, Japan was the second largest importer of U.S. beef by value at nearly $2.4 billion but the top customer by volume at 320 million metric tons. Japan was the third largest U.S. export customer for pork by volume and value at almost $1.7 billion.

Biden Says He Will Not Immediately Remove Phase 1 Trade Deal With China

Thu, 22 Sep 2022 02:56:41 GMT

(Reuters) - U.S. President-elect Joe Biden has said that he will not immediately act to remove the Phase 1 trade agreement, which President Donald Trump inked with China, the New York Times reported on Wednesday.

In an interview with a Times columnist, Biden said that the United States needed to get leverage back to use in negotiations with China.

“I’m not going to make any immediate moves, and the same applies to the tariffs,” Biden said. “I’m not going to prejudice my options.”

“In my view, we don’t have (leverage) yet,” he added.

The United States needs to develop a bipartisan consensus and increase government-led investments in research and development, infrastructure and education to better compete with China, according to the president-elect.

“I want to make sure we’re going to fight like hell by investing in America first,” Biden said.

Under the Phase 1 agreement signed earlier in the year, China agreed to increase purchases of American products and services by at least $200 billion over 2020 and 2021.

The deal also leaves in place 25% tariffs on a $250-billion array of Chinese industrial goods and components used by U.S. manufacturers, and China’s retaliatory tariffs on over $100 billion in U.S. goods.

Biden’s team will pursue policies targeted at China’s “abusive practices,” including “stealing intellectual property, dumping products, illegal subsidies to corporations” and forcing “tech transfers” from U.S. companies to their Chinese counterparts, according to the interview.

On Iran, Biden said he stood by his views that his administration would lift sanctions if Tehran returned to “strict compliance with the nuclear deal.”

Last month, Iranian Foreign Minister Mohammad Javad Zarif had said Iran would fully implement its 2015 nuclear deal if Biden lifts sanctions, which Zarif said could be done swiftly through “three executive orders”.

“In consultation with our allies and partners, we’re going to engage in negotiations and follow-on agreements to tighten and lengthen Iran’s nuclear constraints, as well as address the missile program,” Biden added.

(Reporting by Aakriti Bhalla and Shubham Kalia in Bengaluru; Editing by Christian Schmollinger, Sam Holmes and Raju Gopalakrishnan)

Charges Dropped Against Animal Rights Activist Who Trespassed at Iowa Select Farms

Thu, 22 Sep 2022 00:56:41 GMT

Charges have been dropped against an activist accused of trespassing on property of Iowa’s largest pork producer, AgDay’s Tricia Sloma reports. Matt Johnson is an animal rights activist with the group Direct Action Everywhere and was accused of trespassing on property owned and operated by Iowa Select Farms in May.

Prosecutors claim he helped secretly record the pork producer using ventilation shutdown to euthanize hogs last year because of the pandemic, Sloma says. County prosecutors moved to dismiss the charges last week at the request of Iowa Select.

The company said in court documents that its personnel had been subpoenaed but did not wish to testify. A company spokesperson told the Star Tribune it “could not be distracted by individuals who choose to break the law and grandstand.”

Related:

Animal Activists Attack Iowa Select Farms

Protect Yourself from Online Activism

Animal Rights Activists: Watch for the Signs

U.S. Considers Faster Hog Slaughtering Based on Plant Staffing

Thu, 22 Sep 2022 00:55:05 GMT

The Biden administration is considering a proposal that could allow some pork plants to slaughter pigs more quickly if they boost staffing, a union official said, after a U.S. court struck down a Trump-era rule that removed line speed limits.

The proposal put forward by Quality Pork Processors, operator of a large Minnesota slaughterhouse, and union
officials could benefit companies like WH Group Ltd’s Smithfield Foods and JBS USA, the North American unit of Brazilian meatpacker JBS SA.

Faster slaughtering would help them increase pork production at a time of high demand and soaring bacon prices.

Seven pork plants were initially able to operate without limits on line speeds after a 2019 U.S. Department of Agriculture rule change that did not need congressional approval. Six of the plants had previously received waivers to run at a faster pace.

A federal judge in March invalidated the policy and forced the plants to slow down following a United Food and Commercial Workers (UFCW) Union lawsuit against the USDA over concerns about worker safety.

The second-biggest U.S. pig producer, Seaboard Foods, which did not previously have a waiver, sped up an
Oklahoma pork plant last year under the 2019 rule. Workers told Reuters the faster line speeds increased injuries, and there were not enough employees to run faster production lines safely.

Under the new proposal, Quality Pork Processors would be able to speed up again if the USDA and unions agree staffing levels are high enough, said Richard Morgan, president of the UFCW local that represents the plant’s workers. He said staffing levels could be monitored daily.

“The number of staffing would dictate what the line speed can be that day,” he said. “It’s all about the staffing.”

USDA Secretary Tom Vilsack said last week the USDA was considering Quality Pork Processors’ proposal and that it could create the structure for waivers for five other facilities. He did not give details but seemed to refer to the facilities with waivers prior to the 2019 rule.

“I’m happy that they are tying the line speeds to worker safety, but this is all backroom dealings and does not appear to take into consideration food safety whatsoever,” said Zach Corrigan, senior staff attorney for Food & Water Watch.

The federal Occupational Safety and Health Administration (OSHA) did not immediately respond to a request for comment.

The USDA did not respond to subsequent questions, nor did Quality Pork Processors respond to requests for comment.

Workers at the company’s plant would have more time off and be able to meet production goals more quickly if line speeds and staffing levels increase again, Morgan said. He noted that the workers, who are paid hourly, have been working six days per week to meet production targets.

The plant’s maximum slaughtering capacity dropped by about 7% to 17,700 pigs per week after the court decision took effect, said Steve Meyer, economist for consultancy Partners for Production Agriculture.

Nationally, the pork industry has lost 2.5% of its slaughtering capacity, the National Pork Producers Council said.

(Reporting by Tom Polansek; Editing by Dan Grebler)

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PORK Perspectives: A Minute with Lori Stevermer

Thu, 22 Sep 2022 00:55:05 GMT

For Lori Stevermer, her why in life is simple. It all goes back to agriculture.

“I grew up on a farm,” Stevermer says. “I wasn’t necessarily interested in going back to the family farm – that was my brother’s plan. But I ended up marrying a farmer, so here I am.”

She and her husband, Dale, own Trails End Farm, a feeder pig-to-finish and diversified crop farm near Easton, Minn. In addition, Stevermer serves as Hubbard Feeds’ marketing manager.

“I’m motivated by helping others achieve their goals,” she says. It’s that opportunity to help others find success that keeps her pushing boundaries and growing in her profession.

Nearly 35 years ago, Stevermer stepped out of her comfort zone to say yes to a salesperson position for Wayne Feeds. Since then, she’s continued on in the industry after Wayne Feeds was purchased by Hubbard Feeds in 2000 and then after Alltech’s purchase of Hubbard Feeds in 2015.

Over the years her role has changed from a salesperson to marketing manager, but her why hasn’t changed. Stevermer shares her views on leadership, business strategy, the pork industry and what she’s learned along the way.

Q. Describe your business in one sentence.
A. Hubbard Feeds is a company that makes animal feed products for all kinds of animals – swine, beef, dairy, sheep, goat, even to the less traditional chinchillas and rabbits.

Q. Describe a typical day on the job.
A. Although there’s no typical day, there are certain things that I generally do regularly throughout the week. I’m involved with communications, which can vary from helping our tech team write blogs to creating social media posts. I also work closely with our technical teams on introducing products to the market. We develop information used in training meetings, marketing materials used by our sales teams and I oversee our website. As a manager, part of my day is spent in business planning, looking at our systems internally and determining how can we do things better. I also try to touch base with team members regularly to help them do their jobs better.

Q. How does your company serve its customers?
A. There are two main ways we interact with the market. We have a network of feed dealers. We also have a number of customers across the U.S. that directly purchase our products. Our team, whether that’s account managers or technical specialists, work with dealers and customers to implement those products and programs. They are on the farm walking barns, providing recommendations and working with those farms on their goals. In some cases, we may even do some joint research with the larger farms. We like to say we are “boots on the ground,” and I think that’s true. We don’t just ship a product out the door and never see the farmer again. We really are very close to that end user of our product.

Q. How has the business changed?
A. I’ve seen a lot of change over the years. I used to stop at pay phones to catch farmers over the noon hour. My first computer was chunky-clunky compared to what we have now. It’s good to see the technology improve and change, but it’s interesting that even with as much technology as we have in our business now and with the fast speed that it has changed, what hasn’t changed are relationships. At the end of day, agriculture is still a relationship business. It’s still being able to sit across the table from people, look them in the eye, work with them and build that trust. That hasn’t changed in 35 years, and I think that’s a good thing.

Q. What concerns you about the future of the swine industry?
A. Of course there are some major issues pressing the industry now like African swine fever in the Dominican Republic and Haiti, and Proposition 12 in California. However, one of my biggest concerns is consolidation of the industry. We want there to be a viable industry so that our independent farms, no matter how big or small, can still be around. We want markets for them and access to those markets without too much risk. I think that’s one of the biggest threats to our business.

Q. What are the greatest industry opportunities?
A. Labor is a concern everywhere now. I think it’s also an opportunity for people to come work on a farm that maybe haven’t thought about agriculture as a viable alternative, but really love to take care of animals. If you just look at a broader scope of the of the swine industry, there are so many great opportunities out there. Yes, we need people to work on our farms, but we also need people to do other things like be nutritionists and geneticists. I think if you even open that up a little bit more and flip it a little, we also need kids who understand pigs and agriculture to take other jobs, too. We need them to be doctors and dietitians and politicians. Animal agriculture is less than 1% of the population and we have a whole lot of people making decisions for us that don’t understand our business. The more kids that understand agriculture and can get involved not only in agriculture, but also other areas, that’s an opportunity that should help us down the road.

Q. What do you enjoy most about your job?
A. I like to look at those big projects from conception to completion and work on bringing the team together by using everyone’s strengths. Whether it’s a communications project or introducing a new product to the marketplace, I love helping bring things to fruition. We always talk about how people make our jobs enjoyable. That’s so true. You can’t do big things like that without a good team around you. I definitely appreciate my team.

Q. Who inspires you?
A. When I was young, my parents inspired me as a farm couple in the way they worked and encouraged me to pursue my passions. As I reflect on all the different points in my career, I’m reminded of the people I’ve worked with and work with today who do their job well and encourage me. I also have a close circle of business friends that I can talk to about things – people who inspire me to set the bar high for myself. They are those trusted friends that I appreciate and inspire me to do my best.

Q. What is your business philosophy?
A. It’s probably old school, but I follow Stephen Covey’s principles such as “begin with the end in mind” and “seek first to understand, then be understood.” Those principles stand the test of time. If you follow those, you’re generally going to be successful in your communications and in your business. Surround yourself with good people and don’t be afraid or threatened by that. I’ve been fortunate to work with some good teams over the years. I’m especially grateful for our swine group. We know our strengths and we know each other’s strengths and we work to that. I think that’s an important philosophy that has helped us find success.

Q. What will the business look like 20 years from now?
A. Things change so fast. Who would have guessed COVID-19 and all the things that happened? But if I do look back, I was involved with some research groups early on in my career that looked at the future of the feed business. I think a lot of it has come true. We’ve seen consolidation in industry, and I think that will continue to happen. I think we’ll have fewer farms, but larger farms. I think that’s just the way business goes. In the future, I think there will be opportunities for those niche producers too. I think the adaptation of technology will continue. In the feed industry, I believe we’ll see cameras and tracking systems that will estimate weights of pigs so we can understand growth and feed intake on the spot. I believe those type of technologies will help us manage our pigs better.

Keep reading to learn about Stevermer’s pet peeves and what she would do differently in her career.

PORK Perspectives is a recurring column that provides business and leadership strategy tips from some of the pork industry’s finest. Opinions expressed in this column are the opinions of Lori Stevermer and do not represent the opinions of Farm Journal’s PORK. Watch for future columns featuring advice and insights from more of the pork industry’s leaders.

In-Person National FFA Convention Provides Hope, Opportunity

Thu, 22 Sep 2022 00:54:57 GMT

Students from across the country gathered in Indianapolis for the 94th-annual National FFA Convention on Oct. 27-30. But this year’s convention held even more special meaning than usual.

More than 50,000 FFA members were expected to be back in person following last year’s virtual event attending training sessions, workshops and competing in a host of events. Masks were required for all indoor events this year, regardless of vaccination status, but students and supporters didn’t seem to mind.

“For me it’s getting the experience of seeing everything and meeting all the people that share the same passion as I do for agriculture – especially in the livestock industry. I wasn’t able to come because of COVID-19 last year so it’s just great to be back,” says Jenna DeRouchey of Wamego, Kan.

DeRouchey competed in the National FFA Livestock Judging Contest on Oct. 27. She says it was a great feeling to be back in person after having to compete in a virtual state contest earlier in the year. Nothing can replace being in person for a livestock judging contest, she adds.

After the contest, she took some time to walk throughout the trade show exhibits.

“My favorite thing is to walk through the trade show and see all the different areas of agriculture. I’m personally more exposed to the livestock side, but I enjoy getting to be around crop production and other areas,” she says.

For many FFA members, being in person was a sign of normalcy returning.

“It gives me a lot of hope to be back in person – hope that we will get back to normal eventually. It also gives me a sense of pride to see all of these blue jackets surrounding me and realizing what a big thing I am part of,” says Ryer Roberts of Fruita, Colo. He raises pigs and beef cattle.

Nationally there are more than 735,000 FFA members, AgDay’s Griffiths reports. City officials say the economic impact to Indianapolis is near $30 million. The city is slated to host the convention through 2033.

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FFA Has-Been? No, Your Role Just Changes

PORK Perspectives: A Minute with Rika Jolie

Thu, 22 Sep 2022 00:54:10 GMT

It wasn’t an easy path – nor was it a straight path, says Merck Animal Health’s Rika Jolie. When Jolie packed up her bags and left her entire world behind in Belgium to follow her dream to study in the U.S., it was a big risk.

“I didn’t know what was on the other end, but I was curious,” Jolie says. “Life is a journey – there will be hurdles, but don’t let those hurdles stop you. I had my share of setbacks, but I never let those setbacks stop me and send me packing up my bags to go back home.”

After receiving her DVM from the University of Ghent in Belgium, she flew overseas to Michigan State University where she completed her swine medicine residency and master’s degree before moving on to pursue a Ph.D. from the University of Wisconsin – Madison and MBA from the University of Athabasca in Canada, while working in corporate roles.

“I have had a lot of people who believed in me and helped me get where I am right now. Even on the days when I didn’t believe in myself, they kept on believing,” Jolie says. “All of my mentors taught me about the swine industry, but they also inspired me with respect to critical thinking and science.”

She also is grateful to have parents who have supported her from the very beginning, encouraging her to go to veterinary school at a time when females were the minority in the profession.

“Despite the fact that I left the country, which was not very pleasant for them, they’ve always supported that decision and are always there to help me celebrate my successes in my career,” she says.

For those who know Jolie well, it’s not her proficiency in five languages or the number of titles behind her name that make her such a stand-out in her field. It’s the passion and drive she brings every day in her career that make her so successful in her role as executive director for global swine marketing at Merck Animal Health.

She shares her views on the industry, leadership strategy and what she’s learned along the way.

Rika Jolie says it’s important to “live in the moment.” Photo by Rika Jolie.

Q. What is your why?
A. At Merck Animal Health, we develop products to keep animals healthy. Our tagline is “the science of healthier animals.” We stand behind the science and believe in using science to develop better products and better offerings for animals and our customers. We want to keep the food chain healthy as well as our best friends – our pets.

Q. Describe a typical day on the job for you.
A. Considering that I lead a global team, the world is truly our customer. Before the pandemic, I was traveling between 50% to 75% of my time internationally to meet with colleagues and customers. When COVID-19 struck, we found ourselves in a virtual office trying to fulfill the needs of our colleagues in the market through a virtual environment. Today my typical day involves a lot of calls and video discussions at a range of times to accommodate the various time zones. My day is basically filled with meetings to discuss strategy, marketing and education of customers.

Q. How does your company help and work with its customers?
A. I think we do a really good job of listening to the customer and working very closely with the customer to help fulfill their needs. Sometimes we have larger customers that come to us, not necessarily with a disease problem, but because they want to be educated, along with their teams, on reproduction or ventilation on the farm. We help them establish programs and provide experts to advise them. If we don’t have experts in a certain area on our team, we pull them in from externally. It’s not always about product directly, it’s about educating the customer and their teams to get them on the right track to eliminate problems.

Q. How has the business changed since you started?
A. We used to be focused on providing a solution for disease, but I think we have gone further now, especially with the introduction of technology. Merck Animal Health has a heavy stake in technology now. Swine is not part of it yet, but it’s in the works. We want to offer a full solution – introducing technology that can help producers be more efficient in day-to-day activities and more understanding about what happens to their animals. This could be better recognition of disease, production efficiency with their animals, health status with respect to treatments and vaccine administration and more. We want to help them discover tools for that, but also drive it further to have those tools available to help the end consumer have a better understanding of where their pork chops come from. That’s the shift that has to happen. That discussion now goes beyond disease and the evolution of technology to how can the industry benefit from that technology?

Q. What concerns do you have about the swine industry?
A. With swine, you never know what the next disease will be. There is always a concern that hangs there. Currently, there is a major focus on African swine fever (ASF). I’ve been around long enough in the industry that I remember when it was an issue limited to a small number of markets. But now that disease has spread, and we can no longer say it can’t happen in our backyard. Anything can happen. ASF has proven that to all of us. That is one of my major concerns for the industry. What is the new disease? Will we be prepared for it? How can we prepare ourselves?

As well, the industry is changing and consolidating. The survivability of the smaller producer is at risk. That is a major shift and concern. Will there still be room for those smaller producers, or will we move 100% to a fully consolidated industry which has challenges too? Finally, I’m concerned about the greater voice of the consumer in regard to policy, welfare and environmental sustainability. We are probably lagging a little behind Europe where those voices are already much stronger. That’s a continued worry for the industry – how will that impact us in being able to efficiently deliver pork to our consumer and still feed the world?

Q. What are the greatest opportunities in the swine industry today?
A. To be honest, this is still a very exciting environment that we’re in and there is a lot of opportunity for swine producers. To me, the biggest opportunity is technology. The question is, what is the right technology for the producer? What is their biggest need? What is their biggest problem that they are going to try and solve through technology? And then, is it applicable on the farm? Will it be cost effective for them to switch over to some of these technologies that help them track disease or inventory better? It’s one thing to have technology, it’s another to bring in the wrong technology. I am a big fan of technology, but I always give a disclaimer: technology needs to be additive – we still have to look at our animals. We have to walk through the facility and make sure we connect with and understand the animals. We can’t forget that.

Q. What do you enjoy most about your job?
A. I have a dream job. I can start off the day with a certain goal in mind, but by the end of the day, I may have finished a totally different goal. I really like the people and the cultures. I enjoy the diversity of the role as well as the opportunity to work with people to help get them ready for whatever is next for them. Working with the customers, listening to them and when it all works out right, feeling good that you were able to help somebody solve a problem is what I enjoy most about my job.

Q. What is something that keeps you motivated in your job?
A. There is an exciting generation coming and I can learn from them as much as they can learn from me. I think it’s interesting to have younger team members on the team and to be able to recognize the ones that have the talent and passion to be successful and to help them get there. I believe in the good of people and what they stand for. I want to help them make their dreams come true.

Q. What is your business philosophy?
A. People are the key to success in any business. It’s about working with our people and making sure they have a chance to develop and that we respectfully work with each other. I think that’s important and transfers into how we work with and relate to customers.

Q. What will the business look like 20 years from now?
A. The animal health industry, science and technology are evolving. We can assume there will be more technologies available to develop solutions faster, to respond more quickly to needs than what we can now. We have long regulatory processes that slow us down. Hopefully in 20 years that will be different. We have one product, Sequivity, that offers more flexibility because it’s more tailor-made. In the future, will there be more opportunities for that type of approach in the industry? That’s one thing I’d be looking at. Hopefully we won’t have too many new diseases – in the end, it’s all about the impact of technology on both us and the swine producers we work with.

Q. If you could go back and do something differently, what would it be and why?
A. I would tell my younger self to be patient with the process. You’re on a path, but you’re not locked into the path. You need time to develop, to learn, to gain confidence – it all comes with different life experiences. Eventually you will get there, and you will earn that confidence and respect from people as long as you keep on learning, show a willingness to learn and stay curious about what’s ahead. I think the younger me didn’t quite realize that.

Q. What advice do you have for someone who might like to do what you do someday?
A. You own your decisions for your career. Only you understand the whys behind that. People may try to give you advice and you can listen to it, but you don’t always have to take it. In the end, you understand why you made a certain decision, and that is what’s important. Stay true to yourself, remain compassionate and be empathetic toward the people you work with.

Q. How do you think the threat of ASF will impact the future of the U.S. pork industry?
A. That’s the million-dollar question. Can we keep it out? When ASF comes in, it’s anyone’s guess about what the true impact will be. Are we well prepared? Maybe some are better prepared than others. We’ve learned it just takes one small slip, and it can lead to a major disaster. What is that small slip? It’s the question we don’t have an answer for. It’s the disease with no solution and it may still be many years before there’s a solution. ASF has made us more humble. It reminds us we aren’t in control, and we can’t solve every problem. We must continue to be vigilant and do everything we can to prevent it from entering.

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PORK Perspectives: A Minute with Milan Hruby

PORK Perspectives: A Minute with Pat Joyce

PORK Perspectives: A Minute with Kent Bang

PORK Perspectives: A Minute with John Waddell

PORK Perspectives is a recurring column that provides business and leadership strategy tips from some of the pork industry’s finest. Opinions expressed in this column are the opinions of Pat Joyce and do not represent the opinions of Farm Journal’s PORK. Watch for future columns featuring advice and insights from more of the pork industry’s leaders.

PORK Perspectives: A Minute with Mike Hemann

Thu, 22 Sep 2022 00:53:47 GMT

When the late Kendal Thompson walked into a room, everyone took notice. It was hard to miss his 6’9” frame, but it was even harder to miss his heart for people, says Mike Hemann, CEO and president of DPI Global from Carlinville, Ill.

“A lot of people have served as mentors to me in my career, but Kendal is at the top of the list. We lost him way too soon,” Hemann says. “It is unbelievable how many family farms were successful because of him and touched by his expertise. Many of those farms could not have survived challenging times or thrived to be the operations that they are today without his guidance and wisdom.”

In April 2021, Hemann took on a technical sales role with DPI Global with the intent of transitioning into the role he holds today. Unfortunately, that transition happened earlier than anyone wanted when Thompson suffered a heart attack in June 2022.

“Kendal had a way of connecting with every person he met,” Hemann says. “It didn’t matter if they were the gas station clerk or the CEO of a major pork operation, Kendal treated everybody like they were important. And people felt it.”

Hemann says that principle guides his actions every day. “When I wake up the first thing on my mind is, “How can I make a difference in somebody’s life? How can I impact someone’s day and be that gentle giant in the pork industry like Kendal Thompson was?”

He shares his views on the industry, leadership strategy and what he’s learned along the way.

Q. How did you find your way to DPI Global?
A. I was raised on a grain and livestock production farm in southern Illinois. We produced commercial feeder pigs and I was heavily involved in the showpig and purebred industry as well. I pursued a degree in applied swine nutrition and management at the University of Illinois. As an undergraduate, I worked in Dr. Bob Easter’s lab where we conducted research for DPI. It is interesting how things have come full circle in my career. Prior to starting my master’s under Dr. Easter, he was promoted to department head for Animal Sciences at U of I. Fortunately, Dr. Mike Ellis came down the hall and said, “You need to come down here with me.” Both Ellis and Easter served as joint advisors through my master’s program. My research focused on the effects of feeding high oil corn in swine rations on pig performance, meat quality, and fat quality. When I finished my masters, I conducted some contract research for Dr. Ellis before leaving to go work for Land O’Lakes. After 13 years there, I joined Zinpro Corporation for eight years before going to work for my long-time mentor and friend at DPI Global.

Q. What is DPI Global’s why?
A. DPI Global is a California-based company that started with a focus in the orchards of California. We often get asked, “How did a soil amendment being used in an orchard end up in a swine ration?” It was out of the scientific curiosity of our team back then, and it has evolved to become a staple product within the industry. DPI provides all-natural phytogenic feed additives for livestock, in addition to serving aquaculture, horticulture, pet foods and municipal waste treatment facilities. So, when you come down to it, our why is making lives better. Much of our raw ingredient product is sourced in Mexico. People from those communities where it comes from say our company has changed their lives by providing employment and opportunities for the next generation. I think about that during my work day as well– I want to be able to impact all of our employees’ lives. That carries over to our customers, too. If I can sit down with our customers and discover a solution or a technology that we can bring to them, it’s like throwing a pebble into the pond. It ripples out farther than you can imagine.

Q. Describe a typical day on the job for you.
A. We are a small company in regard to the number of employees. We all wear a slightly different hat every day. That is the exciting thing about my position – the opportunity to provide leadership to our team, but still be intimately involved with sales, marketing and production. Part of my challenge is staying focused on the big challenges and not getting distracted with too many irons in the fire. That can be challenging at times, but it also provides us a good perspective of the company and the customers we serve.

Q. How does your company help and work with its customers?
A. When we are in the process of developing a solution, we focus on answering this question first: Am I just listening to the customer or am I hearing the customer? Our team is not afraid to go out and grab someone else outside from within the industry and make a request saying, “I need some help in this area because my customer is having this challenge. This can be an opportunity for both of us.” I think that’s the beauty of our team and how we approach the customer. We also have the advantage of being flexible. There’s no set solution for every problem, only the requirement to really “hear” our customers.

Q. How has the business changed since you started?
A. Technology continues to come at us faster every day. We are always figuring out our next step from a technology standpoint and how it can apply to customers. For example, right now we are focused on looking at new ways to deliver products to customers. Are there better active ingredients available? Are there better physical forms of the product we can get to our customers? Are there different applications that our customers can use that we haven’t thought of? We are centered on being a science-based, research-based, technology-driven company, but we also want to evolve with our customer. Communication is key, and how we communicate is constantly changing. We need to think about that because people still sell people. Relationships create opportunities. That’s how we will solve problems by having those individual relationships where we can capitalize on knowledge from each other.

Q. What concerns do you have about the swine industry?
A. My biggest concern is labor. If we can make someone’s job easier by applying technology, that’s a great thing, however we still need the person to execute that technology. We can’t forget that we are dealing with a biological system. If Mother Nature decides to get up in the morning and be in a bad mood, there’s not a piece of technology that can overcome that. I’m concerned that we’ve lost that “sixth sense” of the generation we used to have who grew up with a farm background. They could go into a barn and know when something was wrong. We’ve gone so far away from that generation, and we don’t have the people we need coming back to production. We’re discovering non-traditional employees, which is fine. But we must figure out how to engage that labor force. For technology to continue to grow, it requires application. If we can figure out how to attract and retain the right people, we can knock down a lot of mountains in terms of what we need to do to feed a growing population.

Q. What’s the best advice you’ve heard?
A. I’ll never forget something Dr. Ellis told us. He said, “You need to be like a swan – calm and placid on top of the water, but you better paddle like hell under the water to get done what you need to get done.” There will be times when you feel the pressure of life weighing on you. Keep that calm demeanor, but work like heck underneath the surface to get what you need to get done. Jack Kelly at Land O’Lakes and Wayne Cast have also given me some good advice over the years. In general this is one of the important things they have taught me “Pigs will never let you down, it’s the people who will.” If we can educate and mentor the people applying the technology of today, pigs will respond by growing quickly and converting feedstuffs into a healthy protein source.

Q. What is your business philosophy?
A. It comes down to three things that may not be very profound in the business world but have been profound in business applications to me.

1. We need to listen twice as much as we talk. Seek to understand, to really figure out and hear what the customers are saying and then apply that.

2. Control what you can control. There’s been a lot of things coming at us lately that we don’t have control over. But, if you can control what you are doing with your business, and really excel at that, a lot of those things don’t affect the success of the business. Be great at what you are good at.

3. It’s never the wrong thing to do the right thing. Just be a good human. Treat each other with respect. Put yourself in the customer’s shoes as you sit across the table. Look at their challenges and opportunities.

Q. What will the business look like 20 years from now?
A. The interaction of health and nutrition will become even more important. With increased pressure regarding less antibiotic use and the loss of some feed additives, we need to look more closely at how nutrition plays a role in health and how health affects nutrition requirements. I see those occupational fields, aka nutritionists and veterinarians, starting to play together better in terms of combining efforts, putting egos aside solving problems.

Q. If you could go back and do something differently in your career, what would it be and why?
A. I wish I would have realized sooner that everyone has a role, and it fully matters. Sometimes when you are younger in your career, you look for the bright shiny object aka the person within the system you think can help you make decisions in your career. While that’s not wrong, you can’t overlook the people feeding the pigs every day, checking that the waterers work, making sure the ventilation is set right, etc. It doesn’t matter where you are at in the production system, you have a key role to play, and everyone matters. They all deserve some of our time and dedication.

Q. What advice do you have for someone who might like to do what you do someday?
A. Don’t be afraid to fail. You can learn so much from mistakes. As a society we are so focused on success that we lose sight that it’s ok to take a chance once in a while, that it’s ok to fail. One saying that the Navy Seals abide by and is reflected in a recent book I read is this, “Fall down seven times, but make sure you get up eight.” Failure will happen. Learn from those failures and get better. Also, there is a lot of value of checking your ego at the door and not being afraid to have conversations with the barn workers or the hourly workers at the feed mill. A lot of times those individuals can communicate the real challenges and opportunities in a production system as opposed to somebody sitting in the C-suite or in an upper management position that isn’t on the farm every day.

Q. How do you think the threat of ASF will impact the future of the U.S. pork industry?
A. It’s allowed us to examine what we’re doing at all levels from a biosecurity standpoint. It’s also brought to light how much we rely on the export of U.S. pork to add value to our product. An ASF outbreak would shut down our ability to export products and result in a devastating effect on our economy. It invites more conversation around bolstering domestic consumption of pork. How do we bring pork to the forefront as the choice protein to put on your plate three or four nights out of the week as opposed to a piece of chicken or a quick hamburger at the at the drive-thru?

PORK Perspectives is a recurring column that provides business and leadership strategy tips from some of the pork industry’s finest. Opinions expressed in this column are the opinions of Mike Hemann and do not represent the opinions of Farm Journal’s PORK. Watch for future columns featuring advice and insights from more of the pork industry’s leaders.

Read More:

PORK Perspectives: A Minute with Gene Spellman

PORK Perspectives: A Minute with Pat Joyce

PORK Perspectives: A Minute with Kent Bang

PORK Perspectives: A Minute with John Waddell

Markets End Mixed on Monday: Surprises in WASDE Take Soybeans Sharply Higher

Tue, 13 Sep 2022 19:54:11 GMT

Grains close mixed on Monday with a big rally in soybeans pulling up corn, while wheat ended lower. Cattle were mixed with hogs setting back. USDA dealt a few surprises in the WASDE, including lower soybean yield by 1.4 bpa and 600,000 less acres. Corn yield and ending stocks were right in line with estimates, but is the crop still getting smaller? Cotton production was up around 1 million bales but the market acted like it didn’t buy into the numbers, ending well off lows. Michelle Rook gets full analysis with Darren Frye of Water Street Solutions.

Writing Farm Bill in Time of High Prices Pits Farm Group Wishes Against Budget Realities

Tue, 06 Sep 2022 19:41:44 GMT

House and Senate Ag Committee members have a tough job ahead of them writing the 2023 farm bill. They’ll have to balance Republican plans to cut federal spending with desires from farm groups pitching proposals to raise reference prices for commodities, which would require more funds for the farm bill safety net.

History shows writing a farm bill in an environment of strong commodity prices is a challenge. Kevin Scott, American Soybean Association Chairman, says, “Writing a farm bill when prices are good is a little difficult also. A lot of legislators see that you know there’s quite a little money farming right now. However, our inputs and so forth are high so its an easy argument to say we’re not protected quite yet in that part of the farm bill.”

A Republican Study Committee proposed a budget plan to slash federal programs, including farm bill commodity and conservation programs, even crop insurance. Mary Kay Thatcher, Syngenta Sr. Lead Government Relations, says they’re eyeing the deficit.

“One of the toughest things you get a lot of farm groups that say yep we’re gonna go ask for money therefore they’re setting their priorities on having new money,” Thatcher says. “Well what happens if there is no more new money then you have to ratchet back everything you’ve asked for? So at the moment it’s a bit of a mess.”

It’s unclear if the baseline will be helped by the $19.5 billion for conservation in the Inflation Reduction Act. And groups like the American Soybean Association want base acre updates and a higher reference price on soybeans, although they haven’t set that level.

Scott says, “It needs to be higher than where its at. I mean it just does not support us in the ag area. And it hasn’t. I mean we really never dipped into the farm program on the soybean side because of the reference price.”

And in an unprecedented move, even cattlemen are coming to the table asking for enhancements to the Livestock Revenue Protection (LRP) program. NCBA President-Elect Todd Wilkinson says, “If we can continue to improve that program it really will help the average cow calf operator because the numbers, you can have one cow, or you can have a large number of animals and be eligible now.”

He says they want LRP to it provide the same level of risk management crop insurance does.

Wilkinson says, “If we can get into a level where we can use that to protect the producer from some of these difficult markets where we maybe can’t get into the market timely for the cattle, it really could be an effective tool.”

And when it comes to crop insurance, its one area of the farm bill that continues to have consensus from farm groups and lawmakers regardless of party. So, Thatcher’s confident about preserving it as is, and without caps directed at large farmers.

She says, “You know we’re already seeing ideas to change the premium subsidy so farmers have to pay more but you know if I was thinking optimistically in the farm bill right now I feel very good about where crop insurance is because I think people recognize it’s a pretty important safety net.”

Who controls Congress may in the end dictate the tone of the next farm bill. If led by Republicans, it’s expected to look similar to the past two bills, with slight tweaks. Under Democratic control the focus may be on climate.

Grains Mixed on Monday with Livestock Strong, October Hogs Hit New Contract Highs

Tue, 09 Aug 2022 14:38:11 GMT

Grains ended mixed still trying to determine crop size after weekend rains and ahead of crop ratings. Livestock were strong with new contract highs in October lean hogs. Michelle Rook has analysis with Tomm Pfitzenmaier of Summit Commodity Brokerage.

No Decision From President Biden on Lifting China Tariffs...Yet

Wed, 13 Jul 2022 20:32:31 GMT

President Biden says he has not made a decision yet on whether to lift some of the $370 billion of tariffs imposed on Chinese imports by the Trump Administration. Biden has been talking about rolling those duties back for weeks as a way to curb inflation while opening a new exclusion process for firms to win additional relief. However, there are mixed opinions on whether or not the cuts will take place, whether China will reciprocate, and what the impact will be on agriculture.

Farm Journal Analyst Jim Wiesemeyer tells us he is not optimistic about tariff relief materializing. And if it does, he says it won’t have much direct effect on ag imports into China.

“On the initial ones, I don’t see much because U.S. Trade Representative Katherine Tai wants some leverage,” he says. “Although China has clearly shown that it is not going to move them. So initially I don’t see it will be part of the $10 billion.”

One caveat is some targeted duties could be dropped which would lower farmers’ costs such as the 25% tax on semiconductors and other parts that go into farm machinery. Plus, crop protection product ingredients.

Frayne Olson, NDSU crop marketing economist says, “Some of the basic chemistry we import from China, we add in the specialized ingredients here and they’re sold in the U.S. So, this reduction or potential elimination of import tariffs may have an impact on the input side, the cost of inputs coming in.”

And while tariffs on soybeans imported from China were already under some import exclusions, officials with the American Soybean Association say any further movement on the 301 and 232 tariffs will be helpful.

Steve Censky, American Soybean Association CEO says, “Even though the tariff China has right now for a lot of these state-owned enterprises has been suspended on soy imports, they’re still hanging out there and it has a bit of a chilling effect.” So, Censky is optimistic about the impact at least a partial reduction of levies will have on the ag industry.

Wiesemeyer says the tariff reduction isn’t likely to lower inflation and is an admission that tariffs don’t work. Additionally, the White House has also been weighing a new investigation into Chinese subsidies and their damage to the American economy as a way to pressure Beijing on trade.

USDA Hogs and Pigs Report Shows Lack of Expansion

Wed, 29 Jun 2022 20:02:14 GMT

Wednesday’s Quarterly USDA Hogs and Pigs Report confirmed continued contraction of the U.S. swine herd. It showed a 1% drop in most categories. Michelle Rook has analysis with Joe Kooima of Kooima Kooima Varilek

Will Hog Prices Return to March Highs?

Thu, 09 Jun 2022 13:37:59 GMT

Lean hog futures hit new contract highs on March 31 and then corrected nearly $25 before bouncing in mid-May.

Market support has come from tight supplies as year to date slaughter is nearly 5% below 2021. However, its being somewhat offset as pork exports are off last year’s record pace, with less China business.
Plus, economic uncertainty is dampening domestic demand. So where are prices headed the rest of 2022 and will we retest contract highs?

Pat VonTersch, Professional Ag Marketing, Luverne, Minnesota says, “Well, the good news, Michelle, is, is that we’re you know, we’re in a lower supply here. We have been all year long down about 5% relative to a year ago. And fortunately, that hasn’t provided for some some elevated cut out values compared to a year ago. And so I think we’re really experiencing some challenges as it relates to the demand side of the equation. I question that the chance of going back to customer as high as, you know, historically this time of year is a good time to be to be looking at some hedging opportunities. And I’m not so sure that this year is a much different. So and that’s the tight hog supply is for the next 30 days or so. But from a seasonal perspective, I would expect to get into a few more numbers as we get later into the third quarter and into the fourth. >

VonTersch says the lean hog futures did allow producers to lock in some profits even with high feed prices, but those margins are below 2021.

U.S. Pork Industry Gears Up to Fight Foreign Animal Disease, ASF

Thu, 09 Jun 2022 13:14:28 GMT

The U.S. pork industry’s priorities this year include trade, ag labor and foreign animal disease prevention. As part of that, the National Pork Board made a strategic investment to prevent diseases, like African Swine Fever, including the development a new program called Agview.

The free, technology solution provides traceability for pork producers. With enough voluntary participants, AgView will help the industry rapidly contain an FAD outbreak. This will allow regionalized pork export bans so trade can normalize more quickly in the event of an outbreak.

National Pork Board CEO Bill Even says, “So, it’s owned by the producer, the producer controls their data but in the event of an emergency like a Foreign Animal Disease they can share that data really quickly digitally with the state veterinarian. That’s going to be really important so A, we can manage the disease and B they can actually get their businesses back up and running in time.”

The big question is can U.S. producers actually keep ASF out of the country?

Even says, “We think that prevention is the best practice so we’re really focused on prevention and working with Custom and Border protection and also working with the USDA.”

USDA is providing technical support but has also stepped up with $500 million of Commodity Credit Corporation funds to combat Foreign Animal Diseases, which is unprecedented. The pork industry is also working with USDA, and the states on emergency response plans in the event of an outbreak.

Empty Barns: Several Factors Shrink U.S. Swine Herd and Slow Expansion

Thu, 09 Jun 2022 02:15:44 GMT

Coming off a record year of profitability in the pork production sector, one might expect expansion in the U.S. pork industry. However, a number of headwinds, including diseases like PRRS and PED, are keeping numbers down from 5 to 6 percent over a year ago.

Dave Mensink, a pork producer and former Minnesota Pork Producers Association president from Preston, Minn. says, “A lot of empty barns is what I’m hearing also. A lot of empty barns in the industry because of disease pressure.” He says he has ‘put the brakes’ on expansion. “The hog slaughters are reduced 5 to 6 percent because we’ve had such disease in our industry. One of the biggest challenges that we have is, if we are going to expand, we’ve got to do it in a way that we can have healthy pigs.”

This might be part of the reason several new hog facilities have been built in South Dakota, where pork production has been growing at a rate of 7 to 8 percent each year. “The attraction is primarily the fact that we don’t have the hog concentration some of our surrounding states have and that makes it very conducive to come to South Dakota,” says Glenn Muller, South Dakota Pork Producers Council executive director.

Muller says, so far, they’ve seen less herd health issues over the last several months. “Iowa, Minnesota and Nebraska are seeing more population density of pigs and therefore have more exposure and more risk associated than we do in South Dakota.”

EverAg economist, Dr. Steve Meyer, noted disease isn’t the only issue limiting expansion. “Number two is we’ve had labor problems all over the place, including at the production level. Number three is the cost of building these buildings just went out of sight last year. And then there’s the availability of work just to get a building put up.”

High input and feed costs are also making pork production less attractive. Mensink says, “The feed prices are high and to bring all this back is going to take a few months. It might even take a year before all this production is back in line, and then it’s still a question of what’s our feed prices going to be a year from now?” Fortunately higher hog prices have offset some of the cost, but his margins will still be under 2021, Mensick adds.

Last year, low cost pork producers made a record $20 per head and average producers made $10, Meyer says. However, producers will likely be under that mark this year with the climbing cost of production.

New SD Pork Process Plant Faces Opposition

Tue, 07 Jun 2022 19:24:22 GMT

A new pork plant is planned for South Dakota that could be up and operational by 2025. Wholestone began in 2016 as a vision of Minnesota-based Pipestone, a company that manages sow farms and has production and marketing services designed to support family farming operations. They’ve also evolved in producer-owned processing.

Wholestone Farms wants to build a more than $500 million plant on this 170 acre parcel and process nearly 3 million hogs annually, expanding capacity beyond their Nebraska facility.

Mitchell, South Dakota pork producer Brad Greenway says, “The Fremont (Nebraska) plant, what is was is the 200 or so producers that own that plant or farmers you know had more pigs than what that plant can handle and so looking at how do you expand and how do you take that next step, and this is that next step.”

Brad and his son Brent are farmer owners and he says he’s been surprised by the pushback on the project. “The Wholestone Farms packing plant is truly farmer owned and very local as much as you can get. The farmers bring the pigs to this and they’re also owners of the plant.”

Brent says Wholestone’s integrated model allowed them to add another barn to the family operation, so he could come back to the farm. “I used to work in manufacturing facilities and through the expansion of the amount of pigs that we raise I’ve been able to come back on the farm. And that’s one thing in order to have the opportunity for young farmers to come back to the farm there has to be a place for the product to go, whether that’s crops or livestock.”

Glenn Muller, Executive Director of the South Dakota Pork Producers Council says the project would add shackle space and encourage growth in the region’s swine industry. Glenn Muller, SD Pork Producers Council Executive Director, “We’re expanding our harvesting capacities in the area which is definitely going to have an impact as producers can see that they have an outlet close by and eliminate some of the transportation issues that we have.”

And that would increase also increase competition, which Hunter Roberts, South Dakota Department of Environment and Natural Resources Secretary says is greatly needed. He says, “We’ve seen those industries way too consolidated so to have like Wholestone a new party come in that is going to you know take a different model to look at this I think it’s encouraging to see.”

Muller says the opposition is based on water quality and some of the odor issues associated with the outdated Smithfield plant. He says “Perceptions are that we’re going to have a replica of that building and some of the technology will be the same but the ability to control the environment and air quality is going to be entirely different with this new facility.” In fact, the Wholestone plant will be sustainable and utilize the newest technology.

And it has the potential to add 1,100 jobs and millions of dollars to the Sioux Falls economy. Greenway says, “That’s what we’re proud about, not only what the plant will look like what it will bring for jobs and what it will bring for all of those things that come with more employment here.”

MARKET WATCH: Grains Slump, Hogs for the Win on Wednesday

Wed, 18 May 2022 21:38:41 GMT

IN-DEPTH MARKET ANALYSIS: Wednesday was a risk-off day in the agricultural commodity markets. Everything was in the red except hogs with spillover from the selloff in the equity sector after Fed Chair Jerome Powell made hawkish comments about the economy and interest rates. However, the grain markets were very overbought, especially in wheat after the run up to new highs. Michelle Rook talked to Chip Nellinger with Blue Reef Agri-Marketing to get the full analysis.