USA - Smithfield to cut sow herd by up to 5%

Smithfield to cut sow herd by up to 5 percent
By Janie Gabbett on 2/20/2008 for Meatingplace.com

Smithfield Foods said it will cut its U.S. sow herd by 4 percent to 5 percent — or 40,000 to 50,000 sows — a move that will ultimately result in production of 800,000 to 1 million fewer market hogs annually.

The company said it will begin phasing in these reductions immediately. Smithfield currently raises 18 million market hogs annually.

"Given the economics for raising hogs today, we cannot continue on the current path; something has to change," said C. Larry Pope, president and chief executive officer. "Grain costs continue at record levels, with the potential of escalating, given the current U.S. government policy favoring corn for ethanol. Today the economics are very challenging, and we believe that these increased costs will translate eventually into still higher food costs for the American consumer. In the meantime, Smithfield is taking immediate action to improve the efficiencies of our live production operations."

With sales of $12 billion, Smithfield is the leading processor and marketer of fresh pork and packaged meats in the United States, as well as the largest producer of hogs.