Structural change in U.S. hog production during the past two
decades has had profound effects on industry performance and on
strategies for dealing with change. Hog producers have increased
productivity and reduced costs through major adjustments to the
size, organizational structure, and technological base of their oper-
ations. These adjustments have lowered pork prices for food
processors and consumers. However, concentrated hog production
has imposed environmental risks and nuisance impacts on nearby
communities. In addition, society in general has raised concerns
about food safety and animal welfare issues.
As hog production has consolidated, fewer and larger opera-
tions account for an increasing share of total output. The number of
hog operations fell by more than 50 percent during the past two
decades, while the hog inventory remained relatively stable. From
1992 to 2004, average production from hog operations grew nearly
fivefold to 4,646 head in 2004. Over the same period, the share of
the total hog inventory held by operations with 2,000 or more head
increased from less than 30 percent to nearly 80 percent; in 2004,
operations with 5,000 or more head held 50 percent of inventory.
The traditional approach of farrow-to-finish hog production
(all stages from breeding until slaughter) has given way to opera-
tions that specialize in a single production phase. Specialized hog
finishing operations accounted for 40 percent of hog operations in
2004, up from 19 percent in 1992. Operations specializing in far-
rowing and raising weanlings, so low in number as to be rarely
reported in 1992 and 1998, totaled 7 percent of operations in 2004
and produced an average of more than 20,000 head per farm.
Overall, the share of hog production from farrow-to-finish opera-
tions fell from 65 to 18 percent during 1992-2004, while that from
specialized hog finishing operations increased from 22 to 77 percent.
Contracting contributed to much of the growth in production
from specialized hog operations. Production from hog opera