In the span of 35 years, Bob Ivey has built three hog production systems from scratch.
The first was the family-owned and operated Ivey Spring Creek Farm (ISCF) near Goldsboro, NC, which began modestly in 1979, with select purebred Chester White and Spotted bloodlines that grew to 250 sows with the help of a low-interest, Farmers Home Administration (FmHA) loan during the Carter administration. Select lines of Durocs, Landrace and Large Whites were imported from Denmark in the early ’90s, and the ISCF nucleus herd grew to over 2,200 purebred sows, its current size.
The next opportunity arose in 1989, when the Maxwell family (Maxwell Foods, Inc.) decided to diversify their turkey enterprise and better utilize the excess feed processing capacity of Goldsboro Milling. Bob Ivey developed a three-site production concept, unique at the time.
The third challenge came in 2006, when Maxwell Foods recognized a growth opportunity in Indiana. Ivey was able to take the many lessons he and his staff had learned in the previous two startups and apply them to a 20,000-sow production system.
Hard Work and Tenacity
Hard work was standard fare on the Ivey family’s tobacco and poultry farm east of Goldsboro. Bob and his older brother, Ted, spent long, sultry days working in the tobacco fields and picking eggs for a hatchery that restocked layer barns. “It was a seven-day a week, 365-day per year job,” he remembers.
After graduation from high school, Ted headed off to North Carolina State University (NCSU) to major in economics and poultry production. Four years later, Bob chose the University of North Carolina, majoring in chemistry.
After graduation, Ted returned home to expand the tobacco and row crop acreage. Graduating in 1976, Bob decided he wasn’t cut out for a career in chemistry in the nearby Research Triangle in Chapel Hill, NC, opting instead to try his hand at purebred hog production.
Interest rates had risen to around 15%, which made the FmHA interest rates of 3-5% all the more attractive. Ivey drafted a business plan focused on supplying breeding stock to the many other young farmers funded under the federal program.
Ivey Spring Creek Farm (ISCF) was launched in 1979. “We built the new farm with purebred genetics in mind,” he explains. “I basically wanted to leverage our skills to produce more than just commodity pork. Since I went to a liberal arts college, I really didn’t have any livestock training, so the specialists at NC State and the Extension Service really gave me my education.”
At the outset, Ivey sought breeds known for breeding ability and reproductive performance, which drew him to the Chester White and Spotted breeds. “I was looking for more aggressive breeds that would perform in the heat in North Carolina,” he explains.
But the emphasis that the breeds placed on hog shows baffled Ivey, so he turned to Swine Extension Specialist Charles Stanislaw for guidance. The state’s on-farm testing program focused on growth rate and backfat depth, initially measured with a steel ruler, later with ultrasound equipment. In addition, Ivey incorporated 21-day litter weights as a measure of sow productivity.
In those early years, Stanislaw and Ivey relied on slide rules and punch cards to tabulate performance data and rank boars and gilts using standardized indexes. But when Radio Shack introduced the first personal computer, things began to change. Ivey and Stanislaw pioneered performance-testing software that has been tweaked over the years and remains the basis for the state’s on-farm program today.
Stanislaw was also instrumental in introducing Ivey to the National Swine Improvement Federation (NSIF), organized for the advancement of performance testing in the swine industry. Ivey served on the NSIF board of directors and met many geneticists and performance testing leaders from around the world.
Significant improvement was made in the maternal performance of the Chester White lines, but Ivey struggled to make genetic progress in the Spotted breed. So, in the late ’80s/early ’90s, with the help of the state department of agriculture, he headed for Denmark to select Duroc, Landrace and Large White lines.
Just when the seedstock business in the southeastern states was picking up — pseudorabies hit! “That was the kiss of death to a purebred business,” Ivey reflects. “As North Carolina was becoming so dense with hogs, pseudorabies became a very big deal. When it infected our original pure lines, it was a very tough experience.”
But Ivey was fortunate to have the services of local swine veterinarian William Plummer, who helped orchestrate off-site segregation of positive sows, allowing them to test and identify negative offspring and salvage their valuable genetic lines.
During that tumultuous period, Ivey was also invited to join the North Carolina swine disease task force, which put him in contact with leading veterinarians and the large integrators in the state. “Dr. Plummer was a good teacher, willing to share his knowledge, and I learned a lot from being on the task force,” Ivey relates. “While on the task force, I saw a lot of the issues that were being managed by the big integrated companies, just in moving pigs. But because pseudorabies was a state-controlled disease, they couldn’t move pigs freely to where they wanted them.”
Enter Goldsboro Milling
In 1989, as the industry was struggling to control pseudorabies, Goldsboro Milling contacted Ivey with an interesting proposition. The Maxwells were entrenched in turkey production, but they had excess feed processing capacity. They had watched the unprecedented growth of the hog industry in the state and wanted to direct the surplus milling capacity to hogs. Knowing little about hog production, they turned to the Ivey brothers, who signed on as general managers, to build the new hog enterprise from scratch.
Drawing on what he had learned about pig movement and disease spread, Bob Ivey designed the new Goldsboro system with three-site production. “Back then, most everybody built breed-to-feeder pig units with finishing somewhere else, or they had single-site, farrow-to-finish units,” he relates. “Because of my experiences with the breeding stock business and the swine disease task force, I designed the Goldsboro system to help manage those issues.”
Everything the Maxwell’s built was three-site production. “Every sow farm had an isolation barn associated with it, mainly to control pseudorabies. It allowed us to take positive sows and make negative animals so we could move them freely,” he explains.
Siting nursery barns on a separate location was the new twist. “That helped break the disease cycles. By having those on separate sites, if we had a disease problem, we could clean it up a little faster,” he notes. Finishing barns were built on a third, separate site.
In his original design, Ivey bumped sow herd size from a common 750 sows up to 1,000 sows. The goal was to capture some economies of scale and help specialize workforce tasks. When the first sow farm was deemed a success, additional farms were added, usually in increments of 2,000 or 4,000 sows.
“We built all of the sow farms alike. Nurseries were built pretty fast and all pretty much alike,” he recollects. “Then, we built the standard 720-head, tunnel-ventilated finishing barns. I wrote the standard operating procedures for each area of production. We were hiring and training a lot of new people, so we had to develop instructions early, just because we didn’t have enough people to answer all of the questions,” he explains.
While the Goldsboro system was being built, Smithfield Foods was making plans to construct a new packing plant in Tar Heel, NC. “The race was on to try to capture as much shackle space as we could for that plant,” Ivey remembers. “We went from the first 1,000-sow farm in 1989 to 72,000 sows by the time the (building) moratorium was put in place in 1996.”
Word soon spread that the Maxwell’s were looking for employees. “We hire a lot of local people because we have always felt it is important for our employees to be able to spend time with their families. Most everybody who started with Goldsboro has stayed with Goldsboro,” Ivey says. “I think the average tenure of our leadership is about 17 years.”
Stocking the sow herds with quality genetic lines was another major undertaking. “We grew so fast that there was no way one genetic supplier could handle it all,” he says. Initially, sow barns were stocked with PIC, Seghers and ISCF gilts. The Maxwells were familiar with two predominant lines of turkeys, so they had a good recordkeeping model that allowed them to track the strengths and weaknesses of the genetic lines. It also helped that the Goldsboro system was built around a pyramid of 4,000 sows that supplied pigs into associated nurseries and finishers.
From a reproductive standpoint, the PIC and ISCF lines rose to the top. PIC had the edge for pig/sow/year (p/s/y), but ISCF’s emphasis on 21-day litter weights produced a 1½- to 2-lb./pig advantage at weaning, which improved wean-to-finish livability.
“We actually tracked which lines made the most money, so I worked like crazy on the weaknesses of our (ISCF) genetic lines. I saw the integrated results, so I could react quicker and address the deficiencies,” Ivey explains. “Basically, I rebalanced the selection indexes to emphasize the things that made the most money for the Maxwell system.”
All production data is now tracked through the AgriStats benchmarking program, which many of the state’s large integrators use. Although the farms and genetic lines are not identified, the rankings help identify the weaknesses in a farm or system.
“I can tweak our indexes, rebalance them and push the genetic program in the direction needed to make up the economic opportunity that is needed to be the leader,” he notes. “The big thing we worked hard on was reproduction — p/s/y — but we never lost our emphasis on 21-day weights. And, according to the AgriStats database, our sow mortality is 5-6%, while the average in North Carolina is over 10%.” The Maxwell system has consistently been in the top 25% nationally and a consistent leader in the southeast region as benchmarked on AgriStats.
About two years into their growth spurt, genetic suppliers couldn’t keep up with the boars needed for natural service, so Ivey built the first artificial insemination (AI) center. “Back then, the boars all had different indexes and the best boars cost more. The AI center allowed us to buy better quality boars and leverage them across more sows.” Soon, a second AI center was on the drawing board.
Round Three
In 2006, the Maxwells offered Ivey the rare opportunity to build the third new production system, this time for 20,000 sows in Indiana.
“Fifteen years after giving me the opportunity to build the original system, they gave me the opportunity to build one that is better. We used everything we and the rest of our team had learned — from what kind of hinges to use on the doors to how to lay out the buildings,” he explains.
“The biggest differences were the economies of scale, the design of the buildings and how we ventilate them. The model is based on 5,000-sow units that can fill a 4,000-head, deep-pitted, ‘quad’ wean-to-finish building in two weeks. We learned we can make things bigger, but still maintain a very friendly design for the animals and for the people. We know so much more now; I guess that’s one advantage of getting older,” he contemplates.
One thing Ivey didn’t change was gestating sows in pens. This was a holdover from the original seedstock enterprise, where five or six gestating sows or gilts, depending on their size, are housed in 8 x 10-ft. pens with partially slotted floors. While serving on National Pork Board and National Pork Producers Council committees, Ivey saw the animal welfare issues surfacing in Europe and expected similar concerns would find their way to the United States.
“There are social and economic reasons for the pens,” Ivey explains. “They are less expensive to build and maintain. We don’t have all of the concrete issues associated with the front of the (gestation) stalls where sows are fed and watered. In my view, as long as we can keep sows housed in stalls for at least 30 days to get them back into condition (after weaning), their performance in the pens is the same as sows housed in stalls.”
Managing Risk
“I think everybody recognizes that not only do you have to be good at production, you have to have a lot of reserves,” Ivey says. “There are a lot of good companies that didn’t make it through the past few years because of the financial pressures. Today, the big challenge is not only having good production and being efficient, but you really have to understand your risk and have the capital to manage that risk. Even if you can do a crush and lock in a profit, you’ve got to have a lot of backing from your lender to manage those commodity prices as they bounce up and down on a daily basis. It’s not such an easy thing to do.
“Those of us who have survived have really learned how to be cost efficient. We have learned where our strengths and weaknesses lie, and we understand there are some things that can’t be changed. We are a grain-deficit state. That’s a disadvantage for our biggest cost — feed. We have to make sure we can make up that disadvantage to stay competitive,” he notes.
Going forward, Ivey sees more cooperation and specialized risk-sharing programs. “I don’t see new or expanding building activity, but I do see us improving the relationships we have with others in the pork chain to help remove some of the risk,” he says.
“Never Give Up”
Randy Stoecker, formerly with Murphy-Brown, once told Ivey: “You can’t be thin-skinned in the hog business.” He has taken the advice to heart. “When I started, farmers were really appreciated by the public, by our state and national government. Now, we seem to always be on the defensive, always apologizing for what we do. I don’t understand that. I think we need to be a little more thick-skinned in life, in general, and not let all of the chaos around us affect where we’re headed,” he explains.
“I have had some luck and I have had good people who have influenced me. Those people wanted to make me better, and I’ve always hoped the people I have been involved with know that I have wanted to help them do better, too.
“There are a lot of good people who are willing to help you in this industry and, usually, they don’t get anything out of it other than helping you. That’s one of the really good things about the hog business.
“Think about it,” he encourages. “If I can figure out a way to make my pigs healthier and I share that information with my neighbor so his pigs can be healthier too, then there is less disease out there — and it makes the whole industry better. In the end, it may be that philosophy that makes the United States the world leaders in affordable pork.”
Ivey’s advice to young people interested in building a career in the pork industry is simple: “Don’t be afraid to get your hands dirty. One of the big things that has helped me is that I have done most of the jobs that I have asked others to do. That experience has been invaluable. So, get an education, study hard, go out there and participate, tackle those jobs that will teach you a lot — and never give up,” he concludes.
— Dale Miller, Editor