Report looks at economic impact of Iowa’s consolidated pork packing industry

Ag/Outdoor, News

November 3rd, 2012 by Ric Hanson

A national consumer advocacy group released a report Friday that claims Iowa’s shift to large-scale hog production has hurt the state’s rural economy. Wenona Hauter, executive director of San Francisco-based Food and Water Watch, says consolidation in the pork packing industry has forced thousands of small-to-medium size hog producers out of the business. “Over the past three decades, the number of hogs sold in Iowa has doubled, but the value of those hogs has actually declined,” Hauter said. “The number of hog farms dropped more than 80-percent and hog prices have plunged.”

The report claims the fewer, but larger processing plants have also resulted in a decline in wages for the plants’ workers. Hauter, in a conference call with reporters, said the prevailing wisdom has been that hog production and processing has become more efficient – which provides more economic punch to hog producers and cheaper food to consumers. But, the report found otherwise.  “The Consumer Price Index for pork has risen by almost 80-percent during the period we studied, while the real hog prices and the real packing plant wages have dropped,” Hauter said. “The decline in the value of hogs and wages have had a ripple effect through the entire economy as farmers and workers have less to spend at main street businesses.”

The study analyzed county-level economic, agricultural and demographic data in five-year intervals from 1982 to 2007. “Meat packer funded studies just look at the total economic output of the consolidated hog industry, but they ignore the damage to rural economies from the decline in the number of independent farms,” Hauter said. “Medium size farms are more likely to buy farm supplies locally and are the foundation of rural economies.” Larry Ginter, a former hog farmer in Marshall County and a member of Iowa Citizens for Community Improvement, also took part in the conference call. He said the four biggest packers in Iowa slaughter nine out of 10 hogs, so “independent farmers cannot get a fair price with that kind of stranglehold on the market.”

(Radio Iowa)