April 11, 2008

US pork plant processing sows for export to China

A Midwest pork plant has recently begun processing sows and will ship the carcasses to the growing Hong Kong and China markets, according to industry participants and livestock dealers.

The plant reportedly processing the sows is the Farmland Foods facility, which was acquired by Smithfield Foods in early 2007.

How many sows said to be processed at the plant is unknown.

Jerry Hostetter, spokesman for Smithfield Foods, said the company "signed a confidentiality agreement with China and cannot comment on trade with them." In addition, he said "Smithfield Foods has a policy of not commenting on daily operations at our processing plants."

However, livestock dealers and market managers, all of which requested anonymity, said the hog buyers at the four Farmland plants located in Illinois, Iowa, Nebraska and Missouri are purchasing sows that fit certain weight and quality standards. The sows are being accumulated and shipped to the Midwest plant for processing.

The dealers and managers said the sow processing for export is "positive" for the US pork industry and producers as the supply of sows is large and prices are very low. Removal of additional sows from the marketplace would eventually be supportive for hog and pork prices.

The USDA's daily sow market report Thursday showed prices on a plant delivered basis for 300- to 450-pound animals at an average of US$12.2 per hundredweight, compared with US$28.4 a year ago. Prices in all weight categories are well below a year ago.

Year-to-date US hog slaughter is up about 10 percent from a year ago. Total pork exports, including pork variety meats, for January and February are up 41 percent from a year ago. February sales set a record at 156,959 tonnes worth US$351.8 million. Hong Kong and China combined is the largest export market for the first two months by volume and ranks second behind Japan by value of the sales, according to the US Meat Export Federation.