As Indiana pork producers gathered for their annual state convention the Indiana Department of Agriculture released the results of two studies that indicate the growth potential of the industry. The first study, The Changing U.S. Pork Industry and Implications for Future Growth, is an overview of the industry. The second, Doubling Hog Production, is an in-depth look at the Indiana pork industry through the eyes of the state’s producers.

In a printed release, director of agriculture Andy Miller says, “Both studies clearly reinforce Indiana’s opportunities to expand our pork industry. They also underscore some on-going challenges of consolidation within the industry and how farms will integrate into their communities.”

Both reports provide an economic overview of the industry as a whole. The pork industry is highly integrated, and that trend will continue. The industry has seen rapid consolidation during the last 10 years, and today two-thirds of the independently owned pork operations use long-term contracts to stabilize their price and market risk.

Future consolidation will have a similar impact. Specifically smaller farrow-to-finish operations – those less than 600 sows – may find it harder to compete in the current commodity market. Despite this trend, there is an emerging market opportunity for specialty pork products and many of these operations could take advantage of this new trend.

The Changing U.S. Pork Industry and Implications for Future Growth report also highlights that pork industries in other states have grown due not only to advantages in production, but also to key companies and state legislation. Indiana’s advantages of abundant feed grains and water, sufficient cropland for distribution of organic animal nutrients and sufficient processing capacity and skilled producers, combined with the state’s support, should encourage the industry’s growth.

In addition, Indiana’s pork industry offers significant opportunities for local producers in its processing sector. The state’s producers have opportunities in finishing hogs to market weight. Finishing operations involve lower investments than farrow-to-finish, as well as less labor, lower risk and less hands-on management allowing them to fit into traditional farming operations, such as grain farms.

Both reports also highlighted concerns from the pork industry about negative public perception about environmental and animal welfare issues. While the report notes that these concerns typically are the result of a small number of bad actors who caused environmental damage from accidental manure spills or poor management, these incidents are used repeatedly to heighten pollution concerns and the industry must address this public perception issue.

While providing an overview of the pork industry, the Doubling Hog Production report also offers results of a statewide industry survey. The goal of this survey was to collect opinions about challenges the industry faces and reaction to ISDA’s goal of doubling pork production.

The industry is concerned about environmental issues, including permitting, local zoning and control, odor mitigation, waste management technologies and producer education; protecting profit margins from market volatility; maintaining cost and availability of inputs, such as corn; proactively addressing animal welfare issues to maintain consumer trust; finding and developing a dependable labor force; educating consumers about the industry; site selection for expansion and maintaining a level playing field for all Indiana producers.

To read both reports, go to: http://www.in.gov/isda/pubs/index.html

ISDA news release