Farmscape for June 29, 2021

The National Pork Producers Council is urging the Biden Administration to appeal a court ruling which reduces U.S. pork processing capacity.
The Biden Administration has until the end of August to appeal a federal district court ruling that takes effect today which strikes down pork harvest facility line speeds allowed under the USDA’s New Swine Inspection System.
National Pork Producers Council Spokesperson Jim Monroe says hog farmers are asking for a longer stay of the court order or waivers to allow impacted plants to continue operating at NSIS line speeds until a long-term solution can be established.

Clip-Jim Monroe--National Pork Producers Council:
Unfortunately, this is going to have a very negative effect on U.S. hog farmers.
It's going to reduce packing plant capacity by 2.5 percent overall in the United States.
The impacted plants, there are six of them, their capacity will be reduced by as much as 25 percent.
Again, unfortunately that's going to lead to concentration in the industry, more packing plant market power and lost revenue and additional expenses for U.S. hog farmers.
It's going to negatively impact competition in the industry and that's never good.
Competition drives innovation.
Competition is also good for consumers.
As far as the impact on harvest facility operations, again the impacted plants are going to lose up to 25 percent of their capacity.
What that means is they're going to have more hogs available than they have space to process so that could very well lead to them cancelling contracts with, in particular, smaller producers.
Those hogs will then have to be sold on the spot market where they will likely receive less value.
In addition, producers will face additional expenses because they're going to have to transport their hogs to more distant plants that have available capacity.

Monroe notes an analysis conducted by Iowa State University Economist Dr. Dermot Hayes projects pork producers will lose 80 million dollars in revenue opportunities as a result of the ruling this year alone.
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Bruce Cochrane.

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