Research has shown the impact of an African swine fever (ASF) outbreak on the U.S. pork and beef industries would be economically devastating. A recent analysis shows it would be even more devastating now with high input costs.
In a study led by Dermot Hayes, an economist with Iowa State University, analysis shows an ASF outbreak would result in a $79.5 billion impact on the pork and beef industries and directly impact 60,000 industry workers with job loss. Pork prices would drop between 50% and 60% and would stay low for three years before recovering. Read the full study here.
“As you might imagine, the results are awful,” Hayes says. “We export almost 30% of our pork. That would back up into the domestic market immediately and flood the domestic market with inexpensive product. Some of the variety meats would simply be tanked and not used because they would otherwise have gone to China.”
He points out that industry losses in the first couple of years would be due to low prices, prices could even fall by more than 50% for live hogs.
“If the industry couldn’t get ASF under control, those revenue losses would continue. But instead of it being low prices, there would be fewer producers, fewer integrated producers, fewer finishers, and we'd have to downsize the industry by either 25% or so of the net exports that we currently do,” Hayes says.
For the first couple of years, the result of ASF would be financial disaster. For the next eight to 10 years, if the U.S. cannot get ASF under control, it would require downsizing the industry, he adds.
Since 2018 when China reported ASF in their swine herd, the National Pork Board and producers across the country have accelerated current efforts to prepare, respond and recover from a foreign animal disease like African swine fever.
Joel Nerem, DVM, chief veterinary officer with Pipestone, says there is no question the impact ASF or any foreign animal disease would have on the U.S. pork industry.
“Producers need to be prepared to respond – and that means everyone,” Nerem says. “We need to be prepared to respond and respond quickly because it's in our national interest, as well as in the individual interest of every producer, to be able to respond quickly to a foreign animal disease because of the implications that it has.”
The first step that he advises his customers to do is to create a Secure Pork Supply plan with an enhanced biosecurity plan for every location that a producer has pigs. Secondly, producers need to have 30 days of movement data at their fingertips that’s recorded and ready to share with state animal health officials or anybody else that's responding to a foreign animal disease incursion.
Patrick Webb, DVM, assistant chief veterinarian with National Pork Board, encourages producers to use AgView, a free opt-in database and dashboard technology that provides the ability for producers to securely share location and movement data with their state animal health officials so they can rapidly determine where disease is and isn't.
“As it relates to that movement data, we view AgView as a tremendous resource for producers to record and store their data, particularly if they don't already have that data stored in another format,” Nerem says. “We believe that AgView provides a great common platform for this data in a very standardized way for state and local health officials to receive it.”
Information and data are power, Webb says. The biggest gap he sees right now as it relates to preparedness and being able to regionalize to get producers back into business quicker, is the ability to share data in a way that it makes sense to a state animal health official and allows them to make risk-based decisions.
“Traceability is a necessity for the U.S. pork industry,” Nerem says. “It's table stakes, and we've got to get there. We ultimately need to get to a next generation of traceability. We need traceability that is real time and accurate. I think the U.S. pork industry of the future has a real opportunity if we have world-class traceability, because it puts us in a position as the supplier of choice for pork worldwide and isn't simply a response to a threat of a foreign animal disease.”
AgView continues to improve with producer feedback, Webb notes.
From the new opt-in feature that allows producers to opt in to sharing their data in real time with their state animal health official, “This allows us to get in front of the eight-ball, so to speak,” Webb says. “Producers can securely share locations and movements with the state animal health official in peacetime, as opposed to wartime. This is an advantage in preparedness across the industry.”
They also improved the product to allow tracking of feed movements, rendering and carcass disposal movements and the movement of animals through harvest channels between markets.
“These improvements have been adding more day-to-day value back for the producer. We want to do that because we want to keep data current in there,” Webb says.
With all the added stress on pork producers right now, Webb says the most important thing he wants producers to know is that the Pork Checkoff is listening and cares about them.
It is front of mind for all producers that these are not great markets to be in, Nerem explains.
“That’s tough because they're thinking about immediate survivability. A foreign animal disease may seem way off in the distance, but it doesn't change the fact that this risk is still here and ongoing,” Nerem says. “On the other side of these markets, the threat of foreign animal disease will be there as well. We need to continue to prepare for it.”
On the bright side, Hayes notes exports are up tremendously for the first three months of this year, reflecting the very low prices in the U.S.
“Exports are offsetting what could even be a bigger price issue. The reason we had the price issue was that we have slightly lower mortality in the herd than we had a year ago, so we have had more pigs coming to market,” Hayes explains. “Retailers have been slow to pass along those lower prices at retail to consumers. But that will happen eventually, it's a competitive sector. Then, that will bring an end to this current crisis.”
Editor’s Note: Producers are invited to stop by the National Pork Board’s booth, V341, at World Pork Expo where they will be demonstrating and sharing AgView throughout the event.
More from Farm Journal's PORK:
ASF Outbreak in the U.S. Would Cost Billions, Researchers Say