Get ready. Packers are preparing to drastically change the way they buy your hogs. In the not-so-distant future, hog pricing schemes will be based on four main parameters: weight/weight uniformity, leanness, pork quality and food safety.
"A year or two from now, it is going to be a whole new ballgame because pricing will be basically quality driven," declares Ray Bjornson of Hormel Foods Corp., Austin, MN.
There will be huge discounts for poor-quality hogs. "I am convinced that the discounts for poor quality are going to be at least as severe as the differences we see now between lean and fat hogs," he explains. "It is going to shock some people and it is not that far away."
An Evolving Process Hog buying programs are evolving at a quickening pace. First, hogs were purchased based on weight and weight uniformity, recalls Bjornson. Then leanness was added. "We are paying for weight and weight uniformity and leanness, which are easy to measure."
So producers are largely focused on producing hogs based on those two criteria, weight and leanness. It won't be until pork quality and food safety requirements are integrated into the packer's buying program that producers take an active interest in the integrity of the total product, Bjornson asserts.
"In the past few years, live hogs have gotten 20 lb. heavier and leaner," he observes. "The problem is we are still seeing extreme variation in quality. For example, we have seen the percent of PSE (pale, soft, exudative) carcasses range from 0-50%."
For their part, consumers are becoming very confused with variations in pork quality. They are demanding a product that's safe, Bjornson says.
To meet those demands and retain loyalty in their branded pork product lines, Hormel is working diligently with their producers to improve the hogs they buy, he explains.
Earlier, the company announced that as of Jan. 1, 1999, they will only buy hogs from Pork Quality Assurance (PQA) Level III certified producers (see "On-Farm HACCP Programs Coming," March 15, 1998, pages 46, 48, National Hog Farmer). Hormel also performs quality checks of producers' hogs at no charge.
Bjornson admits fixing pork quality will take time. But he says Hormel is willing to help from the slaughter end. He suggests seeking out top industry consultants to improve production.
And the Hormel official stresses the work must start on the farm because that is where big improvements will be required. "Packers are going to require more records, more monitoring and more assurances that everything is being done correctly," states Bjornson."And the consumer is entitled to that, " he says.
Partnering with producers, such as packer contracts, has helped achieve progress in the pork quality area, he says. Since 1993, producers on packer contracts with Hormel have been required to be at PQA Level III. They also must have their facilities, recordkeeping systems and financial statements approved. "It basically assures that anybody who is on contract with us, we would hope would be the best producer of the best pigs, and be a partner for the future," states Bjornson.
PQA Push IBP inc. officials announced at World Pork Expo that they are encouraging all producer suppliers to be certified at Level III of the PQA program by January 1999. IBP will assist producers by holding certification meetings.
Rochelle and Swift and Company are also encouraging producers who supply hogs to their packing plants to be PQA certified. Farmland Industries, Inc. will require PQA Level III status on Sept. 1.
The National Pork Producers Council have urged all U.S. pork packers to require PQA Level III certification by Jan. 1, 2000.
Completion of PQA Level III verifies that a pork producer has reviewed the required best management practices. In doing so, the producer becomes better prepared to adopt the principles of HACCP (Hazard Analysis and Critical Control Point) on the farm.
Other Hormel Initiatives Hormel is also involved in several other efforts to improve their ability to buy the best hogs.
Bjornson says a lot of pH testing is being done on the kill floor. "Twenty-four-hour pH levels (postmortem) are a very good indicator of meat quality. We are going to be bringing that testing protocol on line to use as another predictor of pork quality, specifically color and water-holding capacity." The lower the pH score, the poorer the meat quality. Hopefully by late this year, pH scores will become part of the information offered to producers on kill sheets.
Hormel has been extensively testing the Autofom carcass scanning system and plans, before long, to use it on the kill line. The Autofom system can accurately detect carcass percent lean and location of lean or muscle mass in the carcass. "It will help us accurately determine and pay for percent lean, but even more so, where that lean is located," he adds.