The Economics of Global Pork
I read with great interest the February 2 article by Glenn Frankel (“Polish farmers raise a stink over US agribusiness giant”). Frankel does a fine job conveying the opinions of Marek Kryda, “a Buddhist and vegetarian who worked as a guide in a national park before heading to Los Angeles in the early 1990s,” but fails to accurately report the economics of the global pork industry.
Proposals to restrict the size and ownership of pig-raising operations are politically popular since they appeal to anti-corporation environmentalists and small producers and packers too inefficient to compete with new and bigger rivals. But consolidation and vertical integration are major trends in the pork industry, both in the U.S. and around the world, because they enable the industry to attract new capital, boost productivity and achieve better quality control and risk management.
Consumers benefit from safer and higher quality products, more choices, and competitive prices. Workers benefit from contracts that protect small producers from risk, infusions of labor-saving capital, and opportunities for career advancement. Even the pigs benefit from cleaner, safer, and temperature-controlled environments.
Larger scale and better capitalized hog farms can manage manure and other waste products better than smaller farms, a fact vividly illustrated by the environmental record of corporate hog farms in the U.S.’s North Carolina’s Black River. The area, as Dennis Avery wrote recently, “has the densest hog population in the United States [yet] is rated an ‘outstanding resource water’ by the state. The river has no higher nitrate content today, with 9 million hogs, than it did 15 years ago with 2 million.”
Poland’s consumers and workers should be very pleased that an American agribusiness is investing in their country, and no doubt the vast majority are. Unfortunately, you would not know this from reading Frankel’s article.
John Skorburg is managing editor of Budget & Tax News, a former international trade economist for the American Farm Bureau, and author of a recent study for The Heartland Institute on vertical integration in the pork industry. The study can be found on the Web at http://www.heartland.org/Publications.cfm?pblId=3. This essay was submitted as a letter to the editor of the Washington Post on February 17, 2004. Skorburg’s email address is email@example.com.