Launched in December 1999, Pork America spent 2000 soliciting and securing participants in this “new generation” cooperative. Shareholder numbers are hard to pin down because individuals as well as producer groups make up the roster, but shareholders produce a total of 10 million hogs annually.

Having entered the co-op’s second year, Pork America officials say priorities will now move on to converting business opportunities into firm commitments.

Details of the co-op’s prospects and strategies remain sketchy, largely because the co-op doesn’t want to expose its hand to its business competitors. Here’s a look at some of what’s in the works:
Establish a Proof-of-Concept Plant: Pork America needs to produce some product and have it available in order to demonstrate the co-op’s ability to develop and deliver products meeting specified quality and consistency standards. Such an operation also would serve as a research and development vehicle and could generate revenue to fuel further developments.

Jim Lewis, Pork America board member says the co-op has identified several existing small packing/processing facilities that could serve as a proof-of-concept plant. At the time of this writing, Pork America was still evaluating the options.

The front runner appears to be a Midwest plant with a 500-head daily slaughter capacity. “I would expect Pork America to seal up a proof-of-concept plant by mid-year,” says Linda Eatherton, co-op spokesperson.

The cooperative may seek some Economic Development Grants to help pay for the plant. “We don’t anticipate the first one taking too many producer dollars,” says Lewis. Pork America officials project the plant could pay for itself in less than a year.

Packing/Processing Plant: The co-op is evaluating the feasibility of owning and operating a full-scale, state-of-the-art packing/processing plant (or plants.) “Their interest is not in bricks and mortar, their interest is in getting closer to the consumer,” says Eatherton. “That may mean building or buying a plant. They are looking at all the possibilities.”

The plant size under consideration is a minimum 2,000-head to a maximum 8,000-head daily kill. “We’re not trying to solve the industry’s slaughter capacity problems,” adds Lewis, “we’re just trying to meet our members’ needs.” And that includes returning a profit to Pork America shareholders.

At the same time, a city is courting Pork America with offers to assist in building a packing/processing facility.

Partnerships and Joint Ventures:

The cooperative is talking with several pork marketers and merchandisers about partnerships and joint-venture opportunities. The objective is to secure contracts for the meat that Pork America expects to produce.

Co-op board member, Brad Bradley from Del Rio, Texas, has expertise in exporting to Japan, Mexico, Taiwan and Russia. He will be pursuing export opportunities for Pork America.

Once a “proof-of-concept plant” is up and running, the co-op can quickly convert product marketing discussions into formal contracts for Pork America shareholder participation.
The goal on the packing plant and the joint ventures is to have projects underway by year’s end.

Future Shareholder Growth: While Pork America’s current shareholders represent 10 percent of annual U.S. pork production, that number is expected to be 20 percent or more by year’s end. How will it get there?

Two ways, says Eatherton. One way is if current shareholders commit more of their annual production to the co-op (which requires a 20-cent per pig registration).

The other growth area involves increasing shareholder numbers. While “foundation” shareholders (those who signed up by June 30, 2000) get first dibs on Pork America projects, new shareholders can join the co-op at any time. It requires a one-time charge of $500 to purchase one share of membership stock, and a 20-cent, per-pig registration fee. You are then able to make equity investments in Pork America projects that interest you.

As Pork America enters Phase II, John McNutt stepped aside as the cooperative’s director of development. “The work completed to date has been significant to our organization’s future,” says Pork America Board Chairman Jack Rundquist. “Now it’s time to begin turning investor dollars into profit-generating businesses so we can pursue other new business ventures.”

Additional decisions regarding staff, structure, appointments and resource deployment to meet second-year goals will unfold this spring.

“Pork America is allowing pork producers to reinvent themselves to fit into the raw pork marketplace and tie themselves to the consumer,” says Lewis.

More information on Pork America is available at www.porkamerica.com