Special Section: Pork

Loving the lightweight
Hog producers collectively market hogs -- too light for most U.S. packers -- to ethnic consumers.
 

By Dan Lemke

 
Marshall, Minn. — Lightweight Minnesota hogs are not pulling their load.
 

Pork producers in Minnesota raise about 14 million hogs per year — more than three times the state’s human population. Nearly 5 percent of those pigs are considered lightweight, below the range packers want. Hogs that weigh less than 220 pounds earn considerably less than their market-ready littermates and may actually cost producers money.
 

Minnesota is the country’s third-largest hog producer. Most producers operate on tight margins, requiring peak efficiency. Dennis Timmerman, AURI project director, says producers will turn over an entire population of hogs in a finishing barn at least twice a year. When most are at market weight, all are sold at once. However, some won’t meet the minimum-weight market requirements.
 

“If a producer has a 1,000-head barn and sells all those animals at the same time, for a variety of reasons, 30 to 50 of those hogs won’t be as big,” Timmerman says. “Packers call them a ‘sort loss’ and pay much less.”
Many producers can’t afford to hang on to lightweight pigs because barns need to be cleaned and readied for the next batch, so they endure the losses. An underweight hog is typically sold at 40 percent of market value.
 

Based on production costs and 2002 market prices, a 200-pound hog was sold at a $34 loss, a 210-pound hog at a $12 loss, and a 220-pound pig at a $7 loss.
 

“It’s a challenge for everyone,” says Minnesota Pork Producers Executive Director Dave Preisler. “It doesn’t matter what size you are, a certain number of hogs won’t meet packers’ specs. There are places to go with them — the challenge is: what are you going to get paid?”
 

Some processors have identified niche opportunities for lighter hogs, including Hispanic, Asian, Hmong and Hawaiian markets. “There are ethnic markets for underweight hogs, but the processors serving those markets need volume for economy of scale,” Timmerman says.
 

A market study sponsored by AURI and the Minnesota Pork Producers shows the state produces more than 1,000 underweight hogs each day. But they are located throughout the state, making collective marketing a challenge.
 

A possible solution is a centralized buying station that serves processors, such as Sioux Preme Packing, which specializes in lighter hogs. The Sioux Center, Iowa processor has established distribution channels for lightweight hogs; many are shipped to Mexico where consumers prefer the smaller animal.
 

Some processors are actively looking for lightweight hogs because they have carved out specialty-product market niches and need more volume.
 

Producers may also be able to collectively reach direct markets without a processor. For example, Minnesota Pork Board President Dale Stevermer of Easton says he has been able to find local markets for lightweight hogs. If it increases farm income, it’s worth investigating, he says.
 

“Each producer needs to look at their situation to see how much money they are losing” on lightweight hogs, Stevermer says, “And what are the best ways to change that?”