A new study by the National Pork Board looks at the capacity of U.S. pork packers, in light of record pork production in 2004 and the likelihood that it will be topped in 2005.
“I think we’re okay on capacity for this fall even though we’re going to have some days when we challenge that,” says Steve Meyer, president of Paragon Economics. “Having sufficient capacity to slaughter the larger numbers of hogs that reach market weight each fall is critical to efficient and orderly marketing and to maintaining producer’s bargaining position in the farm-to-packer marketplace.”
The study shows current capacity is 407,875 head per day. That includes only federally inspected plants and is directly comparable to USDA’s daily estimates of hog slaughter under federal inspection, says Meyer.
Ron Plain, University of Missouri agricultural economist, says he is concerned about large pork production estimates for late 2005, as shown in the recent data from USDA. The latest Hogs & Pigs report indicated the swine breeding herd on Sept. 1 was up 1 percent from a year ago and producers planned to boost sow farrowings by 1 percent.
The survey showed that the top four pork packing companies have 64.7 percent of the U.S. hog slaughtering capacity. The top eight firms cover 82.5 percent of total harvest capacity. Of companies that can process 2,500 hogs per day, Excel had the largest capacity increase during 2004 at 4,000 head. Hatfield Quality Meats increased its capacity by the largest percentage, at 30.8 percent.
Slaughter capacity may be larger by next fall. A new plant is scheduled to open in St. Joseph, Mo., in late 2005. This plant will add capacity of about 8,000 head per day. The plant is being built by Triumph Foods, a producer venture. Plain said this will be the first pork plant in this size category built in about eight years.
U.S. plants consistently operate at just over five days a week by using plants on Saturdays. At times of large hog supplies, the U.S. packing sector can operate at 5.5 days per week for sustained periods and up to 5.8 days per week for a few weeks.