A Time to Remember
A Time to Remember
The Most Significant Industry Changes Over the Last 20 Years 1. Production facilities 2. Genetics 3. Nutrition 4. Industry structure 5. Export markets 6. Regulation 7. Disease challenges 8. Consumer mind‐set 9. Activist groups 10. New Technology
Breed to wean facilities • Breeding • Gestation • Farrowing • Unit size • Pig flow
Wean to Finish •Feeder design • Crate design • Flooring • Ventilation • Manure handling • Supplemental heat • Controls and data reporting
Integrating Design and Technology •Sort barns • Large pen design • Double wide • Quad barns • Bio‐Security and pig flow • Remote control and recording of: •Ventilation, water, feed, temperature, pig activity
The Most Significant Industry Changes Over the Last 20 Years 1. Production facilities 2. Genetics 3. Nutrition 4. Industry structure 5. Export markets 6. Regulation 7. Disease challenges 8. Consumer mind‐set 9. Activist groups 10. New Technology
Genetic Changes • Sow Productivity • Longevity • Piglet growth rate in lactation • Growth Rates • Feed conversion • Carcass composition • Lean gain and conversion • Uniformity • Pork Quality • Heat tolerance/seasonal consistency • Target end weights
The Most Significant Industry Changes Over the Last 20 Years 1. Production facilities 2. Genetics 3. Nutrition 4. Industry structure 5. Export markets 6. Regulation 7. Disease challenges 8. Consumer mind‐set 9. Activist groups 10. New Technology
Delivering Nutrition • Ingredient options • Nutrient requirements • Barrows, gilts, boars • Lean growth rates • Seasonal variation • Manure composition considerations • Micro nutrients • Feed additives • Feed budgets • Nursery • Finishing • Sows • Manufacturing • Delivery of feed • Performance targets • Profitability targets
The Most Significant Industry Changes Over the Last 20 Years 1. Production facilities 2. Genetics 3. Nutrition 4. Industry structure 5. Export markets 6. Regulation 7. Disease challenges 8. Consumer mind‐set 9. Activist groups 10. New Technology
Table 1. Top 30 US Pork Production Companies Rank NAME OF OPERATION 1
Smithfield Foods
922,251
2 3 4 5 6 7
Seaboard Foods Christensen Farms Iowa Select Farms The Pipestone System The Maschhoffs Prestage Farms
213,600 162,500 152,500 132,000 130,000 125,000
Est Market Mkt Cummulative Packers Pigs Share Mkt Share 18,445,020 17.6% Smithfield, Farmland, 17.6% John Morrell 4,272,000 4.1% 21.6% Seaboard 3,250,000 3.1% 24.7% Triumph, JBS Swift 3,050,000 2.9% 27.6% JBS Swift 2,640,000 2.5% 30.1% JBS Swift, Tyson 2,600,000 2.5% 32.6% Cargill, Hormel , , 2,500,000 2.4% 35.0% John Morrell, JBS Swift
8
Cargill
116,000
2,320,000
2.2%
9 10 11 12
Carthage System AMVC Management Hanor Maxwell Foods (Goldsboro) Hormel Foods (M2P2) PST Progressive Swine Technologies Tyson Foods New Fashion Pork Country View Family Farms Nebraska Pork Partners
85,000 82,000 80,000 69,000
1,700,000 1,640,000 1,600,000 1,380,000
1.6% 1.6% 1.5% 1.3%
54,000 53,200
1,080,000 1,064,000
1.0% 1.0%
52,000 48,000 46,500
1,040,000 960,000 930,000
1.0% 0.9% 0.9%
13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30
Wakefield Holden Farms Texas Farms TriOak Foods Schwartz Farms M2P2 Swine Graphics Hog Slat (TDM) Garland Farm Supply Eichelberger Farms JC (Carolina) Howard Hitch Pork Total
SOWS
44,500
890,000
810,000 40,500 40,000 800,000 40,000 800,000 35,000 700,000 30,000 600,000 27,400 548,000 482,000 24,100 23,000 460,000 23,000 460,000 23,000 460,000 22,000 440,000 15,000 300,000 2,951,051 59,021,020
States
IA, MO, AK, OK, MN IL, IA, IN, MO IA, MN, SD, NE IL, WI, OK, TX, NC
43.2% 44.3%
Cargill Cargill, Triumph Hormel, Tyson Triumph, Seaboard Smithfield, Indiana Packers Hormel
45.3% 46.3% 47.2%
Tyson Tyson Triumph
NE, IA AK, OK, MO, IN MN, SD, IA
48.1%
Hatfield
PA, OH, IN
48.9% 49.7% 50.4% 51.2% 51.9% 52.4% 53.0% 53.4% 53.9% 54.3% 54.7% 55.2% 55.4%
Smithfield (Farmland) JBS Swift Tyson Tyson Cargill JBS Swift Hormel Tyson Indiana Packers Smithfield Triumph Smithfield Seaboard
NE, IA MN MN TX, IA IA, IL MN IA, CO, OK, NC IA NC, IN NC, SC, KS, IA IA NC OK
37.2% 38.8% 40.4% 41.9%
NC, VA, IA, MO, OK, TX, CO, UT OK, TX, KS, CO MN, SD, NE, IA IA, MN IL, IA, IN, MO NC, MS, IA
NC, IN AZ, IA, MN
0.8% 0.8% 0.8% 0.8% 0.7% 0.6% 0.5% 0.5% 0.4% 0.4% 0.4% 0.4% 0.3% 55.4%
Table 3: Top 10 US Pork Packers and Processors 1 2 3 4 5 6 7 8 9 10
NAME OF OPERATION Smithfield Foods
Plants
Mkt Share
9
Annual Harvest 30,942,000
Tyson Foods JBS Swift Cargill Meat Solutions Hormel Seaboard Triumph Foods Indiana Packers Hatfield Quality Meats
6 3 2
18,798,000 11,960,000 9,360,000
18% 11% 9%
3 1 1 1 1
9,568,000 4,100,000 4,100,000 3,900,000 2,600,000
9% 4% 4% 4% 2%
Routh Packing Total
1
900,000
1%
28
96,228,000
92%
29%
The Most Significant Industry Changes Over the Last 20 Years 1. Production facilities 2. Genetics 3. Nutrition 4. Industry structure 5. Export markets 6. Regulation 7. Disease challenges 8. Consumer mind‐set 9. Activist groups 10. New Technology
The Most Significant Industry Changes Over the Last 20 Years 1. Production facilities 2. Genetics 3. Nutrition 4. Industry structure 5. Export markets 6. Regulation 7. Disease challenges 8. Consumer mind‐set 9. Activist groups 10. New Technology
Pork Industry Regulation • • • • • • •
Waste handling Air quality Worker safety Animal welfare Antibiotic use Free trade ID – COOL
The Most Significant Industry Changes Over the Last 20 Years 1. Production facilities 2. Genetics 3. Nutrition 4. Industry structure 5. Export markets 6. Regulation 7. Disease challenges 8. Consumer mind‐set 9. Activist groups 10. New Technology
Nursery Disease Challenges ‐20 years ago ‐ Today
NAHMS ‐ USDA
NAHMS ‐ USDA
Wean to Finish Disease Challenges ‐20 years ago ‐ Today
NAHMS ‐ USDA
NAHMS ‐ USDA
Common Practices
NAHMS ‐ USDA
The Most Significant Industry Changes Over the Last 20 Years 1. Production facilities 2. Genetics 3. Nutrition 4. Industry structure 5. Export markets 6. Regulation 7. Disease challenges 8. Consumer mind‐set 9. Activist groups 10. New Technology
Consumer Demand
Consumer Spending
In terms of in store profitability, pork segments are key
Profit per pound advantage vs. average meatcase item 154%
103% 71%
63% 47% 29%
25% 13%
Pork Value Added
Pork Tenderloins
Chicken Value Added
Beef Value Added
26 Source: National Pork Board Retail Composite Database 2005
Beef Steaks
Bonless Pork Chops
Ground Beef
Boneless Chicken Breasts
Consumer Spending
Bacon accounts for nearly half of all pork items on menus Distribution of menued pork items at same operators
Pepperon i Breakfast Sausage 8.2%
Sausage 7%
Ribs 2.3 %
12.9%
Pork Chops, Loins, Tenders 4.1% Bacon 46.2%
28 Source: MenuMine 2005
Ham (Sliced, Unsliced) 19.2%
The Most Significant Industry Changes Over the Last 20 Years 1. Production facilities 2. Genetics 3. Nutrition 4. Industry structure 5. Export markets 6. Regulation 7. Disease challenges 8. Consumer mind‐set 9. Activist groups 10. New Technology
The Most Significant Industry Changes Over the Last 20 Years 1. Production facilities 2. Genetics 3. Nutrition 4. Industry structure 5. Export markets 6. Regulation 7. Disease challenges 8. Consumer mind‐set 9. Activist groups 10. New Technology
New Technology 20 Years Ago A time to remember • 1990 ‐ ??? – Plasma for nursery diets – Synthetic amino acids – Vaccines? – Medication? – Split sex feeding – Genetics – Production Systems ‐ SEW
What Technology is Needed? • Top needs…….. • Biggest gaps……. • Biggest opportunities…….
• Records and data systems
• Health challenges • Nutrition • Genetics • New targets
Thank you!
The Most Significant Industry Changes Over the Last 20 Years 1. Production facilities 2. Genetics 3. Nutrition 4. Industry structure 5. Export markets 6. Regulation 7. Disease challenges 8. Consumer mind‐set 9. Activist groups 10. New Technology
Breed to wean facilities • Breeding • Gestation • Farrowing • Unit size • Pig flow
Wean to Finish •Feeder design • Crate design • Flooring • Ventilation • Manure handling • Supplemental heat • Controls and data reporting
Integrating Design and Technology •Sort barns • Large pen design • Double wide • Quad barns • Bio‐Security and pig flow • Remote control and recording of: •Ventilation, water, feed, temperature, pig activity
The Most Significant Industry Changes Over the Last 20 Years 1. Production facilities 2. Genetics 3. Nutrition 4. Industry structure 5. Export markets 6. Regulation 7. Disease challenges 8. Consumer mind‐set 9. Activist groups 10. New Technology
Genetic Changes • Sow Productivity • Longevity • Piglet growth rate in lactation • Growth Rates • Feed conversion • Carcass composition • Lean gain and conversion • Uniformity • Pork Quality • Heat tolerance/seasonal consistency • Target end weights
The Most Significant Industry Changes Over the Last 20 Years 1. Production facilities 2. Genetics 3. Nutrition 4. Industry structure 5. Export markets 6. Regulation 7. Disease challenges 8. Consumer mind‐set 9. Activist groups 10. New Technology
Delivering Nutrition • Ingredient options • Nutrient requirements • Barrows, gilts, boars • Lean growth rates • Seasonal variation • Manure composition considerations • Micro nutrients • Feed additives • Feed budgets • Nursery • Finishing • Sows • Manufacturing • Delivery of feed • Performance targets • Profitability targets
The Most Significant Industry Changes Over the Last 20 Years 1. Production facilities 2. Genetics 3. Nutrition 4. Industry structure 5. Export markets 6. Regulation 7. Disease challenges 8. Consumer mind‐set 9. Activist groups 10. New Technology
Table 1. Top 30 US Pork Production Companies Rank NAME OF OPERATION 1
Smithfield Foods
922,251
2 3 4 5 6 7
Seaboard Foods Christensen Farms Iowa Select Farms The Pipestone System The Maschhoffs Prestage Farms
213,600 162,500 152,500 132,000 130,000 125,000
Est Market Mkt Cummulative Packers Pigs Share Mkt Share 18,445,020 17.6% Smithfield, Farmland, 17.6% John Morrell 4,272,000 4.1% 21.6% Seaboard 3,250,000 3.1% 24.7% Triumph, JBS Swift 3,050,000 2.9% 27.6% JBS Swift 2,640,000 2.5% 30.1% JBS Swift, Tyson 2,600,000 2.5% 32.6% Cargill, Hormel , , 2,500,000 2.4% 35.0% John Morrell, JBS Swift
8
Cargill
116,000
2,320,000
2.2%
9 10 11 12
Carthage System AMVC Management Hanor Maxwell Foods (Goldsboro) Hormel Foods (M2P2) PST Progressive Swine Technologies Tyson Foods New Fashion Pork Country View Family Farms Nebraska Pork Partners
85,000 82,000 80,000 69,000
1,700,000 1,640,000 1,600,000 1,380,000
1.6% 1.6% 1.5% 1.3%
54,000 53,200
1,080,000 1,064,000
1.0% 1.0%
52,000 48,000 46,500
1,040,000 960,000 930,000
1.0% 0.9% 0.9%
13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30
Wakefield Holden Farms Texas Farms TriOak Foods Schwartz Farms M2P2 Swine Graphics Hog Slat (TDM) Garland Farm Supply Eichelberger Farms JC (Carolina) Howard Hitch Pork Total
SOWS
44,500
890,000
810,000 40,500 40,000 800,000 40,000 800,000 35,000 700,000 30,000 600,000 27,400 548,000 482,000 24,100 23,000 460,000 23,000 460,000 23,000 460,000 22,000 440,000 15,000 300,000 2,951,051 59,021,020
States
IA, MO, AK, OK, MN IL, IA, IN, MO IA, MN, SD, NE IL, WI, OK, TX, NC
43.2% 44.3%
Cargill Cargill, Triumph Hormel, Tyson Triumph, Seaboard Smithfield, Indiana Packers Hormel
45.3% 46.3% 47.2%
Tyson Tyson Triumph
NE, IA AK, OK, MO, IN MN, SD, IA
48.1%
Hatfield
PA, OH, IN
48.9% 49.7% 50.4% 51.2% 51.9% 52.4% 53.0% 53.4% 53.9% 54.3% 54.7% 55.2% 55.4%
Smithfield (Farmland) JBS Swift Tyson Tyson Cargill JBS Swift Hormel Tyson Indiana Packers Smithfield Triumph Smithfield Seaboard
NE, IA MN MN TX, IA IA, IL MN IA, CO, OK, NC IA NC, IN NC, SC, KS, IA IA NC OK
37.2% 38.8% 40.4% 41.9%
NC, VA, IA, MO, OK, TX, CO, UT OK, TX, KS, CO MN, SD, NE, IA IA, MN IL, IA, IN, MO NC, MS, IA
NC, IN AZ, IA, MN
0.8% 0.8% 0.8% 0.8% 0.7% 0.6% 0.5% 0.5% 0.4% 0.4% 0.4% 0.4% 0.3% 55.4%
Table 3: Top 10 US Pork Packers and Processors 1 2 3 4 5 6 7 8 9 10
NAME OF OPERATION Smithfield Foods
Plants
Mkt Share
9
Annual Harvest 30,942,000
Tyson Foods JBS Swift Cargill Meat Solutions Hormel Seaboard Triumph Foods Indiana Packers Hatfield Quality Meats
6 3 2
18,798,000 11,960,000 9,360,000
18% 11% 9%
3 1 1 1 1
9,568,000 4,100,000 4,100,000 3,900,000 2,600,000
9% 4% 4% 4% 2%
Routh Packing Total
1
900,000
1%
28
96,228,000
92%
29%
The Most Significant Industry Changes Over the Last 20 Years 1. Production facilities 2. Genetics 3. Nutrition 4. Industry structure 5. Export markets 6. Regulation 7. Disease challenges 8. Consumer mind‐set 9. Activist groups 10. New Technology
The Most Significant Industry Changes Over the Last 20 Years 1. Production facilities 2. Genetics 3. Nutrition 4. Industry structure 5. Export markets 6. Regulation 7. Disease challenges 8. Consumer mind‐set 9. Activist groups 10. New Technology
Pork Industry Regulation • • • • • • •
Waste handling Air quality Worker safety Animal welfare Antibiotic use Free trade ID – COOL
The Most Significant Industry Changes Over the Last 20 Years 1. Production facilities 2. Genetics 3. Nutrition 4. Industry structure 5. Export markets 6. Regulation 7. Disease challenges 8. Consumer mind‐set 9. Activist groups 10. New Technology
Nursery Disease Challenges ‐20 years ago ‐ Today
NAHMS ‐ USDA
NAHMS ‐ USDA
Wean to Finish Disease Challenges ‐20 years ago ‐ Today
NAHMS ‐ USDA
NAHMS ‐ USDA
Common Practices
NAHMS ‐ USDA
The Most Significant Industry Changes Over the Last 20 Years 1. Production facilities 2. Genetics 3. Nutrition 4. Industry structure 5. Export markets 6. Regulation 7. Disease challenges 8. Consumer mind‐set 9. Activist groups 10. New Technology
Consumer Demand
Consumer Spending
In terms of in store profitability, pork segments are key
Profit per pound advantage vs. average meatcase item 154%
103% 71%
63% 47% 29%
25% 13%
Pork Value Added
Pork Tenderloins
Chicken Value Added
Beef Value Added
26 Source: National Pork Board Retail Composite Database 2005
Beef Steaks
Bonless Pork Chops
Ground Beef
Boneless Chicken Breasts
Consumer Spending
Bacon accounts for nearly half of all pork items on menus Distribution of menued pork items at same operators
Pepperon i Breakfast Sausage 8.2%
Sausage 7%
Ribs 2.3 %
12.9%
Pork Chops, Loins, Tenders 4.1% Bacon 46.2%
28 Source: MenuMine 2005
Ham (Sliced, Unsliced) 19.2%
The Most Significant Industry Changes Over the Last 20 Years 1. Production facilities 2. Genetics 3. Nutrition 4. Industry structure 5. Export markets 6. Regulation 7. Disease challenges 8. Consumer mind‐set 9. Activist groups 10. New Technology
The Most Significant Industry Changes Over the Last 20 Years 1. Production facilities 2. Genetics 3. Nutrition 4. Industry structure 5. Export markets 6. Regulation 7. Disease challenges 8. Consumer mind‐set 9. Activist groups 10. New Technology
New Technology 20 Years Ago A time to remember • 1990 ‐ ??? – Plasma for nursery diets – Synthetic amino acids – Vaccines? – Medication? – Split sex feeding – Genetics – Production Systems ‐ SEW
What Technology is Needed? • Top needs…….. • Biggest gaps……. • Biggest opportunities…….
• Records and data systems
• Health challenges • Nutrition • Genetics • New targets
Thank you!
