Monday, March 10, 2008

Desparate Acts by Hog Producers

On the subject of "desparate acts" by the hog producing sector, it would appear that at least one large provider has finally "blinked" ...or so it would seem when reading this article:
This week, Smithfield's production arm, Murphy-Brown, said it will eliminate 40,000 to 50,000 sows from its overall herd of over 1 million sows. "There's a glut of pork out there, and with high input costs, there's no way we can add enough value to make money," Don Butler, director of government relations for Murphy-Brown, told Agriculture Online. "We must cut back. We would hope that other pork producers around the country would see things the same way and take similar action."

While the announcement sent the message that five-dollar corn and $40-hogs don't work, it sent a different concern to the hundreds of contract farmers who operate the farrowing and finishing operations that crank out Murphy-Brown pigs. Which contract farms will Murphy-Brown no longer need?

Indeed, even as the price of corn continues to rise while pork drops further, one has to wonder why anyone would even consider starting a HOG CAFO or CFO in this economic climate.

Sure, the plummeting dollar makes the price of our pork a wee bit more enticing in some foreign markets, but here at home -- you gotta think twice about getting into 'da biz, right?

Well, maybe "how it works" might shed some light onto the "why" of it all. This post by a prospective hog CFO owner is asking for help making his decision of whether or not to go into hog farming. It's quite enlightening:
The deal is that a huge hog farm will "build" me a hog barn on my land and fill it with their hogs, I have to take care of the hogs daily ect., I am also told that the big farm will guarantee me to pay off the barn. I am sure you guys know the type of deal I am talking about.

My question is, Is the hog market so bad that doing this kind of contracting makes no financial sense or is the market bad to the "small" hog farmer. Any insight is appreciated (link)
I've mentioned in the past about integrated contracts -- how it's not necessarily just the farm and/or farmer that needs to go under the microscope as the "source" of problems relating to factory-style farming. The people getting off virtually "scott-free" in all the wastes these farms can produce are the larger entities who "come bearing gifts" ...virtually bribing farmers to go big (or threatening them to get out by pulling their patronage away).

A small farmer with no customers is a bankrupt farmer.

A large farmer with contract in hand, well, maybe he'll eke out enough to feed his family and keep his land a few more years (?) ...

I've said it before, and I'll say it again, CAFOs and CFOs are NOT farms. If anything, owing to their size and the sheer volume of wastes they produce (to say nothing of the water they consume daily), the closest category could be -- light industrial -- and in extreme cases, heavy industrial is more appropriate.

Sure, that's just my humble opinion, but I can assure you, it's an opinion shared by others.

In fact, I was pleasantly surprised when I recently read Mr. Schellinger's official statement on the subject:
Confined Animal Feeding Operations or CAFO's represent a significant challenge to Indiana's quality of life. These enormous, largely unregulated facilities produce vast amounts of animal waste that are then released untreated into our rivers, streams and spread across our land. The magnitude of these operations means that one facility has the potential to affect thousands of people in proximity to it.

I believe economic growth and protecting our environmental quality of life are not mutually exclusive goals. CAFO's can be of economic value to Indiana if they work with the community and not against it. That means taking responsibility for the waste they produce and the impact they create.

As Governor, I would pursue a policy that regulates CAFO's under industrial zoning restrictions rather than agricultural. I would work to implement stronger oversight and monitoring of these facilities, working with communities and CAFO owners to ensure an open, fair and constructive dialogue.

Industrial zoning restrictions -- gotta love it!

Permit me to savor the thought.

Now, once they're all rezoned (to industrial from agricultural), let's take another look at them thar farm subsidies, eh?

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