Federal ruling could leave hog producers in a bind 🎙

By Matt Reese

Citing food and worker safety concerns, there have been multiple recent court cases challenging the U.S. Department of Agriculture’s New Swine Inspection System (NSIS). The results of a recent court ruling in one of those cases could back up production supply chains for hog producers.

In September of 2019, USDA announced a final rule to modernize swine slaughter inspection with the NSIS to protect public health while allowing for food safety innovations and increased line speeds for processing facilities to operate more efficiently. The final rule also allowed market hog establishments to choose if they will operate under NSIS or continue to operate under traditional inspection.

“This regulatory change allows us to ensure food safety while eliminating outdated rules and allowing for companies to innovate,” then USDA Secretary Sonny Perdue said. “The final rule is the culmination of a science-based and data-driven rule making process which builds on the food safety improvements made in 1997, when USDA introduced a system of preventive controls for industry.”

Licking County hog producer Jim Heimerl has been working at the national level for decades to modernize the system to improve efficiency, food safety and worker safety. He said the 2019 final rule was a big win for workers, consumers and hog producers.

“It deals with line speed at packing houses that affects the swine industry as much as anything. It is a broad system that does affect poultry and beef too. It affects how fast the line speed can be dictated. It goes clear back 20 years ago when we had a pilot project with the Clemens Food Group. At that time it was called Hatfield’s. There were five of those around the country. They were trying to see how fast they could run the lines,” Heimerl said. “The basic line speed is 1,106 animals across the line per hour. They were raising the line speed while checking for food safety and worker health to see if they could go faster. Then in 2019 that was signed into law.” 

In a March 31 ruling, though, federal judge Joan N. Ericksen in Minnesota issued an opinion limiting NSIS line speeds to 1,106 hogs per hour, but leaving the remainder of the 2019 modernization program intact. She delayed her order by 90 days, or around July 1.

NSIS opponents claimed a victory for workers rights and food safety with the ruling.

“The court’s decision recognized that Trump’s USDA violated basic principles of administrative law when it refused to consider the impact of its actions on plant workers and claimed, contrary to its longstanding practice, that it was not allowed to do so,” said Adam Pulver, lead counsel on the case. “An agency can’t put its hands over its ears and refuse to consider facts that cut against its policy preferences, as USDA did here in ignoring workers and public health advocates, and blindly following industry’s wishes.”

Heimerl, though, pointed out the significant challenges from the ruling for the pork industry.

“With the new technology, Clemens Group now has to go from 1,450 animals per hour back to 1,106. A majority of the plants in the U.S. now are going safely at these higher speeds, but with a stroke of a pen a judge says it is not practical to do it anymore because unions say they don’t want to do it,” Heimerl said. “What that means to our industry is 2% of the animals that were able to be harvested will not have room to be harvested anymore. When we regionalize that, it means that 25% of the animals I sell to Clemens Food Group will not have a home to sell to after July 1. We’ll have to cut back by 25%. There are three integrators in Ohio that will lose 25%. This is a year-long process to raise these animals. I don’t know what they expect us to do in 90 days to have someplace to take these animals.”

If this is left unchallenged, the federal district court ruling will result in a 2.5% loss in pork packing plant capacity nationwide, and more than $80 million in reduced income for U.S. hog farmers, according to an analysis by Dermot Hayes, an economist with Iowa State University. 

The National Pork Producers Council (NPPC) is urging the USDA to intervene before the ruling takes effect. The ruling will dramatically reduce hog farmer market power — particularly smaller producers located near impacted plants — and undermine pork industry competition.

NPPC argues that the court’s ruling will have the opposite effect sought by those seeking to expand the number of meat packing plant facilities. Lawmakers have recently called for increasing the number of pork processing facilities nationwide by bringing smaller state plants up to federal inspection standards. These facilities represent less than 1% of total harvest capacity.  

“The U.S. pork production system, the most advanced in the world, is characterized by robust competition, innovation and efficiency. With the stroke of a judge’s pen, the lives of many hog farmers will be upended if this misguided ruling takes effect,” said Jen Sorenson, NPPC president, communications director for Iowa Select Farms in West Des Moines, Iowa. “The lost revenue projected by Dr. Hayes is not theoretical; it is based on breeding decisions made several months ago and pigs already in the production cycle that will go to market in a few months.” 

According to Hayes, while the court decision will affect all hog farmers, small hog farmers will disproportionately bear the brunt, especially those near affected processing plants. Michigan pork producer Ed Reed sends 80% of his hogs to an affected plant 15 miles away from his farm. 

“I’m a small farm and we’re trying to capture as much value as we can,” he said. “If we were to slow the plant down…we’re going to have capacity issues.” 

With the next closest processing plant two-and-a-half hours away. Those added transportation costs may be too much for producers to bear, he noted.

NPPC is urging USDA to appeal the ruling, seek a stay while the appeal is considered and request the agency pursue a new, fast-tracked rulemaking that better reflects the modern processing plant technologies and practices and allows for higher line speeds. 

To learn more about this issue and hear more hog farmers describe the impact the court ruling would have on their operation, visit https://nppc.org/issues/issue/preserve-u-s-pork-industry-competition/

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