Several key U.S. pork packing companies will continue slaughter cutbacks for the 3rd consecutive week in ongoing attempts to fight unprofitable operating margins.
"We're still in a reduced production mode and probably will continue in that fashion in the near term," said Mark Klein, spokesman for Excel Corp, a division of Cargill Inc. "The reason is the hogs just aren't there," Klein said. Excel operates pork plants in Ottumwa, Iowa; Beardstown, Ill., and Marshall, Mo.
Slaughter also was reduced at 2 pork plants operated by John Morrell and Co, a subsidiary of Smithfield Foods Inc headquartered in Norfolk, Va. The plants in Sioux Falls, SD, and Sioux City, Iowa were operating at reduced hours as were Smithfield's 3 eastern U.S. plants, said Jeff Luckman, VP of hog procurement at Smithfield.
But Luckman said reductions at Smithfield plants in Gwaltney and Smithfield, VA, and Tar Heel, NC were limited because most hogs purchased were on contract. "If we could, we would cut back more, but we have contract obligations to honor on a daily basis," Luckman said.
IBP Inc plants also reduced operating hours despite having already eliminated the 2nd shift in Columbus Junction, Iowa on March 3 and discontinuing carcass production April 24 at its Council Bluffs, Iowa, plant, said IBP spokesman Gary Mickelson. Both actions were done for an indefinite period.
"We like to run our plants 48 hours a week, or six days a week but because of the current market conditions we are running at a reduced rate due to the fact that product movement has slowed and also that pork producers are out in the fields right now getting their crops in the ground," Mickelson said.
ConAgra Inc also continued slaughter reductions at its Swift and Co pork plants in Marshalltown, Iowa and Worthington, MN, said K.T. Miller, ConAgra spokeswoman.
Farmland Industries planned ongoing slaughter cutbacks at its Farmland Foods pork plants in Denison, Iowa, Crete, NE, and Monmouth.
Hog slaughter under federal inspection on May 5th was estimated at 293,000 head, the same as the 293,000 estimate a week earlier and an actual slaughter of 331,000 a year ago, USDA reported.
USDA estimated weekly hog slaughter last week was 1,649,000 head, up slightly from 1,628,000 the previous week but well below 1,792,000 a year earlier.
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