Murphy-Brown, a division of Smithfield Foods, will reduce the size of its swine breeding herd, announce company officials. The cuts will occur on the East Coast over the next six months.
“Smaller, less efficient, company-owned farms,” will be the target, according to a Murphy-Brown statement. In all, 35,000 sows will be eliminated. That’s about 4.5 percent of Smithfield’s current sow herd.
“This effort will reduce costs over time, as well as lower the number of finished hogs to market,” the statement said. “The company continues to look for opportunities to increase efficiencies, lower its costs, and manage breeding herd numbers downward.”
Industry analyst project that some of the sow-units being taken out of production are 20 years old or more, and have reached their productive life span. This action, will of course, reduce the number of market hogs that Smithfield finishes out, however, the decline will be much less than the 4.5 percent cut in sow numbers.
Murphy-Brown owns the majority of sows for Smithfield within the United States. Other sow production sites, with Smithfield carrying all or partial interest can be found in Mexico, Brazil and Poland.
Earlier in the week, Smithfield announced that it purchased 8 million shares of Campofrio Alimentacion SA, Spain’s largest meat processor, at a cost of about $87.8 million. This gives Smithfield a 15.2 percent control of Campofrio.
Campofrio is one of Europe’s larger pork processors, including fresh and processed pork. It has operations in Portugal, Russia, Poland, Romania and France, and exports to more than 40 countries.
This action further expands Smithfield’s dominance in the pork industry not just in the United States but also internationally.