Small-to-moderate sized producers may be the leading beneficiaries of checkoff-funded programs.
There is move afoot in the pork industry soliciting signatures calling for a referendum on the pork checkoff. To use an old phrase - somebody's trying to "sell a pig in a poke."
Perhaps it's time for a reality check. Either these folks have short memories or they lack the benefit of the history of the voluntary/mandatory checkoff question.
Not that long ago (19856), after a couple of decades of struggling to push the percentage of hogs checked off beyond the halfway mark (it never rose over 62%) pork producers were calling for pay-your-fair-share checkoff program.
The push gave rise to the Pork Act of 1985. Producers paid 25 cents/$100 worth of hogs sold during a two-year trial run. In 1988, producers were asked to file their approval/disapproval about this "everybody pays" program. The referendum received a resounding 79% affirmative vote and the Pork Act became law. Democracy in action.
So now we have a group of nay-sayers circulating petitions, obtaining signatures, in hopes of calling for a vote on the checkoff and, thereby seal its demise. This, despite a recent survey by the Gallup polling organization, which reported 88% of producers felt the checkoff benefited the industry, 72% felt it benefited them individually and 83% favored the checkoff as it stands.
You've probably seen and read the multitudes of literature professing the good, bad and ugly provisions of the mandatory checkoff program. I won't belabor the points except to remind you of the "short list" of areas checkoff dollars are targeted - research, education, pork promotion.
Under the "research" heading, a raft of projects have covered a gamut of topics ranging from pseudorabies and PRRS, to the refinement of segregated early weaning protocols and AI techniques, to development of the PQA program and a growing knowledge base on meat quality and food safety issues. And, of course, we must channel research efforts toward solving water quality and odor control challenges. Meeting any of these challenges requires two things - money and a coordinating body.
Educating producers and/or consumers is listed in the 1985 charter. Roughly 30,000 producers have participated in industry-sponsored seminars, conferences, satellite broadcasts, etc. in recent years. Have you incorporated SEW, AI, separate-site production into your management program? Early work was funded by your checkoff dollars.
Pork promotion - What does it feel like to be the envy of agriculture commodity groups? The "Pork - The Other White Meat" campaign is oft cited as a huge success. When a Gallup poll shows over 85% of consumers recognize pork as a "white" meat and the healthy implications associated with it, your message has hit the mark.
The anti-checkoff advocates are fond of saying the small-to-moderate sized pork producers have come up short when checkoff dollars are spent. I beg to differ. In fact, they may be the leading beneficiaries of checkoff funded programs - particularly in the research and education programs.
For the sake of discussion, let's walk through a simple mathematical exercise. Let's assume all sows produce 20 pigs/year, all pigs will be marketed at 250 lb. and all will sell for $45/cwt. Therefore, the average selling price is $112.50/market hog. We all know the checkoff rate is .45% of market value so the checkoff tab/hog marketed is 51 cents.
Starting with a small, farrow-to-finish operator with 50 sows, the 1,000 market hogs will generate $510 in checkoff funds. Given the choice, where should he invest the $510, assuming all checkoff-funded programs are now cancelled? It's not enough to buy a genetically superior boar, a new farrowing crate, a computer. Can't go to a seminar to learn about new techniques or technology because the coordinating sponsors of those programs have been disbanded.
Taking a large step forward, the next operator, marketing 10,000 hogs (500 sows), could invest his reclaimed $5,100 checkoff in a computer, pay for a consultant to come in a few times a year. But pork promotion, foreign market development and disease research won't likely receive a share.
Then there's the aggressive family down the road who has grown to 5,000 sows, supporting several families. Their checkoff tab on 100,000 hogs is about $51,000. Now there's money to work with. They could remodel a barn, provide seed money to a favorite land grant college for PRRS research (but the results will be proprietary), set up some on-farm feeding studies, etc.
Now for the big boys. The largest pork production system in the U.S. boasts over 300,000 sows, producing at least 6,000,000 hogs, and paying a checkoff tab of over $3 million. Their options? Start construction on another farm? Hire a cadre of environmental specialists and legal advisors? Build a department of the best, brightest minds to conduct proprietary research? Establish a brand name product for an oversees market?
Now would be a good time to think about the checkoff petition that you're being asked to sign. If a vote was called and the mandatory checkoff defeated, who wins? Would that make you more or less competitive?