Meat Industry INSIGHTS Newsletter

970619 Iowa Hog Plant Cutbacks May Signal Move Towards Southern States

Iowa has long been the pork capital of the U.S., but recent migration of hog farms to regions outside the Midwest in search of better political climates and warmer temperatures may soon raise challenges to that title.

"The hog is out of the pen and he is heading south," said George Dahlman, agriculture analyst with Piper Jaffray Inc.

IBP, in explaining it's Iowa cutbacks, cited migration of hog production out of Iowa that has left too few hogs to fully utilize the plants.

Hog populations have steadily increased in the 1990s in North Carolina, Oklahoma, Arkansas and Utah. Those offer producers fewer regulations, more open ground and more moderate weather than Iowa.

IBP spokesman Gary Mickelson said the company currently does not have plans to operate a plant in the South, but if the migration continues, packing companies will have to locate plants "where the supply is."

According to the Livestock Marketing Information Center in Denver, from 1987 to 1996 the number of market hogs in Iowa fell by 1.7 million to about 12.2 million head. Iowa still raised about 22% of the 56 million U.S. hogs in 1996, but that was down from 25.6% in 1987.

Over the same period, the hog herd in traditionally key Illinois shrunk by 800,000, Indiana by 635,000 and Ohio by 520,000.

Meanwhile, hog numbers in North Carolina soared by over 6.04 million head, Arkansas by more than 311,000, Oklahoma by 980,000, Missouri by 485,000, Colorado 324,000 and Utah by 97,000.

Reflecting its traditional dominance in hog output, Iowa is still home to 12 large pork packing plants. So the concern is that IBP's move may signal other processors to follow.

Spokespersons for ConAgra and Excel Inc., a division of Cargill Inc., said they have no plans now to operate plants in the South or move from their Iowa locations.

But some packing company sources said their Midwest plants already ship hogs in from Arkansas, Texas, Georgia, North Carolina and other Southern states.

This Article Compliments of...

Press Here for FREE Subscription

Meat Industry Insights News Service
P.O. Box 553
Northport, NY 11768
Phone: 631-757-4010
Fax: 631-757-4060
E-mail: sflanagan@sprintmail.com
Web Site: http://www.spcnetwork.com/mii