WASHINGTON – According to an economic impact assessment by Dermot Hayes, PhD, a professor of economics and finance at Iowa State University, on the impact of a March 21 federal court ruling that would slow down line speeds at US pork processing plants as soon as July 1, 2021, pork producers would suffer a loss of $83.2 million and the pork industry’s processing capacity in the United States would decrease by 2.5%.
The National Pork Producers Council (NPPC) is encouraging the US Department of Agriculture (USDA) to take steps to reconsider the ruling, which it said would halt a pilot program, known as the New Swine Slaughter Inspection System (NSIS) and impact smaller hog producers significantly. NPPC said the ruling to strike down a provision in the NSIS reverses a 2019 decision to approve and implement faster line speeds, adding that the pilot program dates back to the Clinton administration and has continued throughout subsequent administrations in an effort to update the inspection system that had not been updated in more than 50 years.
Advocates of a federal district court in Minneapolis ruling said the USDA acted unlawfully by eliminating line speeds at slaughter plants because it disregarded the safety of plant workers. The ruling was the result of a federal lawsuit, led by the United Food and Commercial Workers International (UFCW) and Public Citizen. In March, the US District Court for the District of Minnesota ruled that the Food Safety and Inspection Service (FSIS) of the USDA violated the Administrative Procedures Act (APA) when the agency failed to consider whether increasing line speeds would harm workers.
“When FSIS proposed the NSIS, it expressly identified worker safety as an important consideration and requested public comment on whether increasing line speeds would harm workers,” said US District Judge Joan Ericksen. “Then, after receiving many comments raising worker safety concerns, FSIS rejected the comments and eliminated line speed limits without considering worker safety. In doing so, the agency failed to satisfy the APA’s requirement of reasoned decision-making.”
The NPPC said the impact of the ruling would not, in fact, be offset by granting smaller, state-inspected plants federal-inspection status because they only make up about 1% of the country’s slaughtering capacity.
“The US pork production system, the most advanced in the world, is characterized by robust competition, innovation and efficiency. With the stroke of a judge’s pen, the lives of many hog farmers will be upended if this misguided ruling takes effect,” said Jen Sorenson, NPPC president. “The lost revenue projected by Dr. Hayes is not theoretical; it is based on breeding decisions made several month ago and pigs already in the production cycle that will go to market in a few months.”
NPPC warned that high-volume pork processing companies and plants that will suffer significantly from the court ruling as it stands include Seaboard Foods in Guymon, Okla., Wholestone in Fremont, Neb., Hormel in Austin, Minn., Clemens in Hatfield, Pa. and in Coldwater, Mich. and JBS in Beardstown, Ill. If capacities at these plants are decreased, the upstream impact on their hog producer-suppliers would be significant, including lower prices paid for their pigs and more costs to ship them elsewhere.
“I’m a small farm and we’re trying to capture as much value as we can,” said Ed Reed, a Michigan-based producer who sends most of his hogs to one of the affected nearby plants.
He said the next closest plant is two-and-a-half hours away, which creates logistical challenges and increases transportation costs.
“If we were to slow the plant down…we’re going to have capacity issues,” he said.
“NPPC is urging USDA to appeal the ruling, seek a stay while the appeal is considered and request the agency pursue a new, fast-tracked rulemaking that better reflects the modern processing plant technologies and practices and allows for higher line speeds,” said the organization.