Overcrowding on farms behind mystery of China´s floating pigs


41ZpbCRQlrL__BO2,204,203,200_PIsitb-sticker-arrow-click,TopRight,35,-76_AA278_PIkin4,BottomRight,-58,22_AA300_SH20_OU03_Pork Producers2011081000301Overcrowding on farms behind mystery of China’s floating pigs

http://uk.reuters. com/article/ 2013/04/24/ us-china- farming-pigs- idUKBRE93N1C7201 30424

http://uk.reuters. com/article/ 2013/04/24/ us-china- farming-pigs- idUKBRE93N1C7201 30424

Credit: Reuters

By Adam Jourdan

JIAXING, China | Wed Apr 24, 2013 10:36pm BST

JIAXING, China (Reuters) – Overcrowding on farms around Shanghai was the underlying factor that led to 16,000 dead pigs floating down the Huangpu river into China’s affluent financial centre, according to an analysis of official documents and interviews with farmers in the region.

The appearance last month of carcasses of rotting hogs in a river that supplies tap water to the eastern Chinese city was a morbid reminder of the pressures facing China’s mostly small-scale farmers as the country grapples with food safety scares, environmental pressures and, most recently, a bird flu outbreak.

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Until now the main reason for Shanghai’s startling outbreak of dead hogs appeared to have been a local government crackdown on criminal gangs that had been selling abandoned carcasses as meat on the black market, meaning fewer ended up in the river.

But a deeper look suggests that an unsustainable level of overcrowding — a key factor in the spread of disease and death rates — was the critical issue. Experts warn that if conditions are not improved the incident may not have been a one-off.

„We can’t let things go on the way they are or it won’t just be the 10,000 or so pigs in the river this year, we’ll see more in the coming years,“ said Xu Yafeng, CEO of NX28, a specialist web platform for agricultural information.

In an acknowledgement of the problem, officials launched a plan late last year to slash the number of pigs in the region — a drive that may have made things worse in the short-term by cutting the amount of land available for farming before there was a corresponding reduction in livestock.

The number of pigs in Jiaxing, a city just to the west of Shanghai identified as the main source of the dead pigs, more than doubled over the last two decades. It hit 7.5 million in 2012, even as the local government cut the amount of land available for farmers.

This overcrowding of pigs led to the city-wide plan to cut hog numbers to below 2 million within just two years.

“ the winter to this spring, the trend of dead pigs has been particularly serious,“ Wang Xianjun, a local environmental official, told the Jiaxing Daily in March.

„We keep digging more pits to deal with the dead pigs, but if it carries on like this, they won’t be able to take them.“

Wang’s words proved prophetic. Just four days later, the first reports emerged of pigs drifting down the Huangpu.

Local officials contacted by Reuters declined to comment.

FARMING BOOM

China’s booming demand for meat has the potential to create ever more crowded farms, ripe for the spread of disease. Pork demand is expected to grow around 20 percent from 2012 levels to 60 million tons by 2020, according to a recent Rabobank report.

The number of small hog farmers around Jiaxing climbed over the last few years as pork prices surged, resulting in far too many pigs for the land available.

Data from a Nanhu district government document in September shows in 2011 the key hog farming town of Xinfeng had a level of 15.3 pigs per mu (667 sq meters), three times higher than the level of five hogs per mu local officials recommended in August 2012. The nearby village of Fengqiao had levels of 10 hog per mu.

„Disease and mortality rates among the pigs have got worse every year,“ said one woman in the farming area of Henggang on the outskirts of Jiaxing. „In some areas this year mortality rates were probably as high as 30 percent.“

The normal mortality rate for pigs in China is around 3 to 5 percent, Fang Yan, the deputy head of the rural department of China’s state planning bureau, told a news conference in Beijing.

The high density of pig farms, and the poor farm management that is often associated with small-scale farming operations, are key risk factors for porcine circovirus — a common disease among pigs that is the most likely killer of the floating hogs — according to many academic and scientific papers.

Since 2012, however, oversupply has driven pork prices down sharply. Between the end of January and mid-March this year, prices tumbled 16.2 percent.

This had a further impact on disease and mortality rates –when prices are weak, farmers tend to take less care of their livestock, said Tao Shi, a Shanghai-based expert on hog farming.

Increasingly aware of the urgency of the issue, the Jiaxing government launched its plan last September to reduce the number of hogs by two-thirds and to slash the amount of land available for farming by around 40 percent.

„DESTROY THE PIG PENS

Since the carcasses were discovered in the Huangpu, the response has accelerated. A visit to several farming districts around Jiaxing revealed empty sties, which locals said had been recently vacated for demolition.

Three local women in Henggang told Reuters that pig farmers were being given financial incentives to abandon the land, while one official sign, recently painted on the wall of a nearby factory, read: „Destroy the pig pens, lead a happy life.“

Many farmers are not happy. One 40-year-old said he has been ordered to close down his farm, while another farmer Reuters interviewed was in the middle of selling his pigs at a loss of 150 yuan ($24) per head after being told his farm contravened the regulations. Neither wanted their names used.

„They can’t just do it this way and wipe us out so fast,“ the farmer said, as all but one of his pigs were taken away in two crowded trucks over the space of 30 minutes.

The surge of dead pigs demonstrates the wider pressures China’s farmers now confront. Limited land access, falling pork prices, tighter profit margins and the rapid spread of urbanization forces some farmers off the land entirely. Others are pushed to farm in ever more crowded conditions.

Many Chinese pig farmers use medicated feed containing antibiotics to help stave off disease, but cost pressures have led some to cut back on expensive vaccines in favor of giving medication later when illness strikes. Others skirt incineration costs by dumping livestock.

David Mahon, Beijing-based managing director of Mahon China Investment Management said the pressure on farmers‘ margins was huge, which could lead to some farmers cutting corners.

„If you push (farmers) to this point, they’ll do anything to save costs.“ ($1 = 6.1791 Chinese yuan)

(Reporting by Adam Jourdan and Jane Lee; Additional reporting by Anita Li in SHANGHAI and Eleven Du and David Stanway in BEIJING; Editing by Bill Powell and Alex Richardson)

„How Big Pork Screws Small Towns“ MoJo:


Pork packing in Cincinnati. Print showing four...

Mother Jones

CHARTS: How Big Pork Screws Small Towns

http://www.motherjones.com/print/205921

As a new Food and Water Watch report shows, hog farms‚ problems aren’t just environmental.

By | Mon Nov. 12, 2012 3:08 AM PST


I’ve argued often that the food system functions like an economic sieve, draining away wealth. Imagine, say, a suburb served by a handful of fast-food chains plus a supermarket or Walmart or two. Profits from residents‘ food dollars go to distant shareholders; what’s left behind are essentially low-skill, low-wage clerical jobs and mountains of generally low-quality, health-ruining food.

But the food system’s secret scandal is that it’s economically extractive in farming communities areas, too—and especially in the places where industrial agriculture is most established and intensive. I first learned about this surprising fact from the Minnesota-based community-economics expert Ken Meter, specifially this 2001 study [1] on a farm-heavy region of Minnesota. And now Food and Water Watch, working with the University  of Tennessee’s Agricultural Policy Analysis Center, has come out with an excellent new report [2] documenting the food industry’s effect on several ag-intense regions, with the main spotlight on the hog-centric counties of Iowa, the nation’s leading hog-producing state.

The structure of Iowa’s hog farming went through a dramatic change starting in the early 1980s. As this FWW chart show, first, the number of hog farms in the state declined.

All charts by Food and Water Watch. All charts by Food and Water Watch. At the same time, the toal number of hogs raised in th state nearly doubled.

Accordingly, the remaining hog farms scaled up dramatically, growing by a factor of nearly 11 between 1982 and 2007:

What caused this epochal change? According FWW’s analysis, it was driven by the increasing consolidation of hog packing. Packers are the companies that buy hogs from farmers, slaughter them, and cut them into chops, bacon, and the like. In the 1980s, the meat-packing industry began what economists call a consolidation wave—big companies buying smaller companies and consolidating operations into bigger and bigger processing facilities. As the pork packers got bigger and bigger, they were able to use their market weight to force down the per-pound price they paid farmers for their hogs.

To assess the level of an industry’s concentration, economists use a measure they call „CR4″—the percentage of a market controlled by the four biggest companies. „In most sectors of the US economy, the four largest firms control between 40 and 45 percent of the market,“ FWW writes. At CR4 levels above 40 or so, the reports continues, markets start to lose competitiveness—the big firms have power to dictate terms to their suppliers, in this case, farmers. Look at how CR4 has grown nationally since 1982:

In Iowa, the situation is even more stark. CR4 levels have edged down slightly in recent years, but remain near 90 percent. That means that many hog farmers must either sell to one of the Big Four—Smithfield, Tyson, JBS, and Cargill—or exit the business altogether. As noted above, 80 percent of the farms selling hogs in Iowa in 1982 took the latter route. Most of the rest of them scaled up—and saw the prices paid them by the Big Four plunge. As the next chart shows, the real (inflation-adjusted) price farmers get for each hog fell by more than half between 1982 and 2007.

Now here’s the kicker. When you look at the state as a whole, Iowa’s hog farmers were bringing in more money, in inflation-adjusted terms, in 1982, when they raised 23.8 million hogs, than they did in 2007, when they raised 47.3 million hogs.

This is a great deal for the Big Four packers—they’re getting nearly twice the pork, for less total money. For the farmers, it’s a different story.

People who live within smelling distance of large hog farms have higher incidences of high blood pressure.

Now, Iowa’s hog farming used to be widely distributed across the state—most farms raised some hogs along with corn, soy, and other crops. As farms either exited hog production altogether or scaled up dramatically, hog farming got more and more concentrated into a handful of counties.You might think that people who live in these hog-centric counties got some economic benefit from the vast scaling up of hog production. At least you’d hope so—as I learned on a 2007 trip through one of those counties, Hardin (report here [3]), it’s no fun to live in industrial-hog country. Such areas are marked by clusters of bleak hog houses, each containing as many as 2,400 animals—as well as fetid, foul-smelling manure cesspools (known as „lagoons“) and horrific periodic spraying of nearby fields with liquid shit rife with antibiotic-resistant bacteria. A recent study [4] from University of North Carolina researcher Steve Wing showed that people who live within smelling distance of industrial-scale hog farms have higher incidences of high blood pressure.

Well, Food and Water Watch found that hog-heavy Iowa counties don’t do better economically than other counties—the opposite, in fact. The next chart compares real median annual household incomes in hog-heavy counties (based on the total number of hogs sold each year) with the statewide average.

Note that in ’82, hog-heavy counties had slightly higher-than-average median incomes. After 25 years of scaling up, that reversed itself. Overall, the state’s average median income rose by 14.5 percent over the time period, while median incomes in the state’s hog-intense counties grew by just 10 percent.

Food and Water Watch also finds evidence of growing inequality in the hog counties—while real median incomes grew by 10 percent between ’82 and ’07, average incomes jumped by about a third. „The rise in real per capita income alongside a less robust increase in median household income suggests that  earnings are being captured by a smaller portion of more well-off people in counties with high hog sales,“ FWW writes.

Why the dismal economic performance in the counties that house Iowa’s booming pork industry? It costs money to run a big farm, and the larger the farm, the less of those farm expenditures go to local business, FWW found. Large farms buy about a third less per hog worth of goods from local businesses than small farms, the report shows. And that’s a third less money circulating through local economies, building wealth and creating jobs. The study found that for the average Iowa county, the average number of non-farm local businesses grew by about 30 percent between 1982 and 2007. For the hog-heavy counties, though, the average number of such establishments fell by more than 10 percent.

Not surprisingly, while the average Iowa county saw robust growth in total jobs over that period, for hog-heavy counties, total jobs dropped.

I would be remiss if I didn’t mention the economic story for meatpacking and processing workers—the people who slaughter, cut, and package Iowa’s vast annual hog crop. As Ted Genoways‘ blockbuster 2011 Mother Jones piece [5] shows n graphic detail, conditions have grown quite grom on the slaughterhouse floor. The following chart looks at real annual earnings for packers (workers who slaughter live animals) and processing workers (people who turn carcasses into sellable products). This is a story of full-on immiseration—what were once middle-class jobs now pay poverty-level wages.

Here’s how FWW sums the situation up:

Counties with more hog sales and larger farms tend to have lower total incomes, slower income growth, fewer Main Street businesses and less retail activity. General employment levels have suffered, wages in meatpacking have declined and farm job opportunities  are more difficult to find. In spite of what Big Pork boosters have said, there is little evidence that the trends in Iowa hog production have been good for Iowa’s rural economies.

Now, in their defense, the meatpacking giants often counter that the changes described here are necessary for the provision of cheap food. To deliver you a bountiful supply of pork chops, farmers and workers must be squeezed. But here, too, FWW brings a cold slap of reality. The report finds that when hog prices rise, the pork packers tend to pass on the increase to consumers „completely and immediately“; but when they fall, as they have for much of the past 25 years, the companies tend to pocket much of the difference as profit, passing only some on to consumers.

So, in addition to all the environmental damage associated with factory-scale hog farming [6], it’s an economic disaster, too—unless you happen to be a shareholder in one of the Big Four pork packers.