Hog Farming

Corporations

Company Profiles

The following companies are the top employers in the hog farming industry in North Carolina based on employment data from Dun and Bradstreet.

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Smithfield Foods
Introduction

The hog farming industry's leading company is Smithfield Foods. It is a Fortune 500 company with annual worldwide revenues of more than $13 billion in fiscal year 2013 (1). In September 2013 China’s Shuanghui International Holdings, Ltd. (also known as Shineway Group) acquired Smithfield Foods for $4.7 billion, making it the largest acquisition of a U.S. Company by a Chinese buyer to date (2). Shuanghui is the largest meat processor in China (8). Shuanghui plans to hold an initial public offering in the second quarter of 2014 (2). Rationale for selling Smithfield centered on access to the Chinese market (9).

Headquarters: Smithfield, Virginia
Total Employees (2013): 47,000
NC Employees (2013): 10,000
NC Locations: 40+ locations including Burgaw, NC; Charlotte, NC; Clinton, NC; Kinston, NC; Tar Heel, NC; Wilson, NC
Total Revenue (2013): $13,221 million
Year Established: 1936
Primary NAICS: 11221: Hog and Pig Farming
Sources: (1; 3; 4; 5)

Brands & Market Segments

Smithfield Foods primary product category is hog and pig farming with pork and hog production representing 91 percent of sales (5). The company sells both prepackaged pork goods and fresh meats representing 56 percent and 44 percent of total pork sales respectfully. The company operates over 50 product brands and 3 wholly-owned U.S. subsidiaries (6).

Smithfield owns companies and brands across the value chain. Murphy Brown, acquired in 2000 is the world largest producer of hogs (1; 5). John Morrell, established in 1827, and acquired by Smithfield in 1995 is one of the oldest meat processing companies in the nation with notable brands such as Armour and Healthy Ones (1; 5). In 2013 the Smithfield Packing Company and Farmland Food brands merged to form Smithfield Farmland, providing products for the retail, food service and deli customers (1). In 2007, Smithfield acquired Premium Standard Farms, previously one of the other largest companies in the hog farming value chain in North Carolina (7).

Strategy & Competitiveness

Smithfield Foods, like many other hog production companies, uses a vertically integrated business model. Since 2008, Smithfield increased emphasis on pork products, selling its Smithfield Beef Group and joint ventures (5). Current strategies for growth focus on production of higher value precooked meats and entrees.

Global Footprint

North Carolina is a crucial location for the Smithfield Food value chain. Murphy Brown, the livestock production subsidiary of Smithfield Food is based in Warsaw, NC (1). The company recently expanded the Kinston, NC plant, adding state-of-the-art technologies and increasing production capacity. It also established a new processing plant in Burgaw, NC (1). Smithfield controls an estimated 90 percent of all hog production in North Carolina (7). In 2006, Smithfield owned 244 farms in North Carolina, one in every ten, and purchased hogs from several other independent farms in the State (7).

In 2013, 89 percent of sales were domestic although international markets, such as Mexico, Poland, Romania and Western Europe comprised a growing market (5). Currently, Smithfield Food, through its ownership of various brands, comprises 27 percent of the total United States pork market (5). Smithfield Farmland exports to 40 countries across six continents.

The acquisition by Shuanghui International will also help expand Smithfield’s reach to the Chinese market, the global leader in pork consumption (5). China is the largest importer of American pork, averaging over $866 million in 2012 or 14% of all U.S. exports (9).

References
  1. Smithfield Food. (2013). Integrated Report 2013. Retrieved January 15, 2014 from http://investors.smithfieldfoods.com/annuals.cfm
  2. Ho, Prudence and Yvonne Lee. (2013, Nov. 6). “Smithfield Foods Owner Plans $5 Billion IPO.” Wall Street Journal. Retrieved January 14, 2014 from http://online.wsj.com/news/articles/SB10001424052702303936904579180771391697660 ?KEYWORDS=Smithfield
  3. Smithfield Food. (2013). About Our Company History. Retrieved January 15, 2014 from www.smithfieldfoods.com/our-company/history
  4. Bracken, D. (2013, May 29). “Chinese Company to acquire Smithfield Foods for $4.7 billion.” News and Observer. Retrieved January 14, 2014 from www.newsobserver.com/2013/05/29/2924963/chinese-company-to-acquiresmithfield. html
  5. Hoover’s. (2013). Smithfield Food Company [company overview, family tree]. Retrieved January 14, 2014 from Hoover’s database.
  6. Forbes. (2013) Smithfield Foods [profile and news].Retrieved January 15, 2014 from www.forbes.com/companies/smithfield-foods
  7. Food and Water Watch. (2010, August). Factory Farmed Hogs in North Carolina. Retrieved January 17, 2014 from www.foodandwaterwatch.org/food/factoryfarms/northcarolina- factory-farms/factory-farmed-hogs-in-north-carolina
  8. McDonald, J. (2013, May31). “China’s entrepreneurs expand global business.” Charlotte Observer. Retrieved February 24, 2014 from 3 www.charlotteobserver.com/2013/05/31/4078329/chinas-entrepreneurs-expandglobal. html#.Uwkr1Hm0dJg
  9. De la Merced, M. and D. Barboza. (2013, May29). “Needing Pork, China is to buy a U.S. Supplier.” New York Times. Retrieved February 24, 2014 from http://dealbook.nytimes.com/2013/05/29/smithfield-to-be-sold-to-shuanghui-group-ofchina/?_ php=true&_type=blogs&_php=true&_type=blogs&_r=1

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Maxwell Foods
Introduction

Maxwell Foods is a subsidiary of Goldsboro Milling Company. Initially a turkey production enterprise, the company moved into hog farming in 1989 (1). It is also joint owner of the Butterball Brand, along with the Seaboard Corporation (2). In 2013, Maxwell Foods produced 90,000 sows in the United States, making it the 11th largest hog company in the nation (3).

Headquarters: Goldsboro, NC
Total Employees (2013): 1,000
NC Employees (2012): 975
NC Locations: Goldsboro, Pikeville
Total Revenue (2012): $109.6 million
Year Established: 1989
Primary NAICS: 11221: Hog and Pig Farming
Sources: (4)

Brands & Market Segments

Maxwell Food works primarily within the hog production sector of the pork value chain. It branches out somewhat towards finished products with its joint ownership of the Butterball LLC which operates two brands: Butterball offers turkey and chicken products and Gusto, which retails pork based products from it Montgomery, IL headquarters (5).

Within the hog industry, Maxwell Food is active in the hog farming stage, selling hogs to other companies for processing, distribution and retailing. It partners with Smithfield in many of its pork dealings (6).

Strategy & Competitiveness

Maxwell Food’s strategy is on innovative production processes, including a three site hog production system which helps to limit the spread of disease by separating hogs by different location on the farm and having isolated section for hogs carrying illnesses (7).

Global Footprint

Maxwell Foods is largely a domestic operation with farms in North Carolina (4). It reaches national and international consumers through its strategic partnership with Smithfield and through its Butterball and Gusto brands.

References
  1. Ivey, B. (2007). “Sow Housing” Presented at 2007 Sow Housing Forum. Retrieved January 16, 2014 from www.pork.org/filelibrary/SowHousing/2007SowHousingForum/Presentations/Bob%20Iv ey%20ppt.pdf
  2. North Carolina Cooperative Extension. (2010, September 21). “Butterball Interests Moving from Smithfield to Seaboard.” Retrieved January 17, 2014 from http://duplin.ces.ncsu.edu/2010/09/butterball-interests-moving-from-smithfield-toseaboard
  3. Successful Farming. (2013, December). 2013 Pork Powerhouses. Retrieved January 16, 2014 from www.agriculture.com/uploads/assets/promo/external/pdf/PP2013_03.pdf
  4. Hoover’s. (2013). Maxwell Farms [company overview, family tree]. Retrieved January 17, 2014 from Hoover’s database.
  5. Butterball, LLC. (2013). Corporate Information- Brands. Retrieved January 17,2014 from www.butterballcorp.com/corporate-information/brands
  6. NCSU. (2005). CALS Hall of Fame-Hugh Gordon Maxwell, III. Retrieved January 21, 2014 from http://harvest.cals.ncsu.edu/poultry/index.cfm?pageID=10555&dspGMaxwell#row16
  7. Miller, D. (2011, May 26). “Bob Ivey, general manager of Maxwell Foods’ has built three hog production systems from scratch.” National Hog Farmer. Retrieved January 17, 2014 from http://nationalhogfarmer.com/people/bob-ivey-maxwell-foods-hogproduction- 0515

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Prestage Farms
Introduction

Prestage Farms is a privately held producer of pork and poultry products. The company, founded in 1983 is the 5th largest pork producer in the United States (1; 2). In 2013, the company produced 170,000 sows (2).

Headquarters: Clinton, NC
Total Employees (2013): 1,800
NC Employees (2013): 810
NC Locations: 4 locations: Clinton (HQ), White Oak, Tar Heel, Harrells
Total Revenue (2013): $110.3 million
Year Established: 1983
Primary NAICS: 11221: Hog and Pig Farming
Sources: (1; 3; 7; 8)

Brands & Market Segments

Prestage operates both poultry and pork operations throughout the United States. For pork, the company works closely with Smithfield and subsidiaries of Smithfield, such as Smithfield Premium Genetics (3). Hogs are sourced through a variety of contract and company owned farms in many states, including North Carolina, and then sent for processing at plants in Iowa and Mississippi (3).

In the poultry industry, Prestage captures more of the value chain with processing and retailing outlets. Processing plants located in St. Pauls, North Carolina serve the Prestage Farm brand and also contracts out to private label businesses (3).

Strategy & Competitiveness

Prestage focuses on both the poultry and pork industry to be competitive, with activities spread across the poultry value chain but concentrated in the raising of hogs and processing in the pork value chain. Prestage delivers its North Carolina hogs to Smithfield plants in North Carolina (4; 6) for final processing and retailing with many of its hogs selling at Walmart stores nationwide (5). Its relationship with Walmart was highlighted when reports surfaced of inhumane treatment of hogs by Prestage and Seaboard (5).

Prestage is more active in its poultry operations, controlling more of the value chain including the marketing segment through their Prestage Farm brand of turkey products.

Global Footprint

Prestage Foods is largely a domestic operation with farms throughout the southeast and Midwest (3). It reaches national and international consumers through its strategic partnership with Smithfield and through its Prestage Farms brand.

The corporate headquarters of Prestage Farms is located near Clinton, NC along with a warehouse, two feed mills, maintenance department, vehicle garage, a turkey hatchery, shavings and sawdust storage facility and two laboratories. Company-owned farm sites and contract grower farms are located in several counties throughout eastern North Carolina (7).

References
  1. Hoover’s. (2013). Prestage Farms [company overview, family tree]. Retrieved Jan. 17, 2014 from Hoover’s database.
  2. Successful Farming. (2013, December). 2013 Pork Powerhouses. Retrieved Jan. 16, 2014 from www.agriculture.com/uploads/assets/promo/external/pdf/PP2013_03.pdf
  3. Prestage Farms. (2013). Operating Philosophy and Mission Statement. Retrieved Jan. 17, 2014 from www.prestagefarms.com/company/operating-philosophy-and-missionstatement
  4. Clayton, C. (2013, June 5). “Smithfield a Pork Export Deal.” The Progressive Farmer. Retrieved January 21, 2014 from www.dtnprogressivefarmer.com/dtnag/common/link.do;jsessionid=F9E366731A24A6A5 176C8F637B57151D.agfreejvm2?symbolicName=/free/news/template1&product=/ag/ne ws/bestofdtnpf&vendorReference=cdc37f49-a12b-4710-8d92- f41326abfc58__1370373564667&paneContentId=88&paneParentId=0
  5. Gwynn, M. (2012, January 31). Walmart’s low pork prices come at expense to pigs' welfare. Examiner.com Retrieved Jan. 21, 2014 from www.examiner.com/article/walmart-s-low-pork-prices-come-at-expense-to-pigs-welfare
  6. Miller, D. (2001, June 15). “Prestage Pride.” National Hog Farmer. Retrieved Jan. 21, 2014 from http://nationalhogfarmer.com/mag/farming_prestage_pride
  7. Prestage Farms. North Carolina – Prestage Farms. Retrieved Feb. 18, 2014 from www.prestagefarms.com/company/locations/north-carolina-prestage-farms
  8. Prestage Farms. Our Locations. Retrieved Feb. 18, 2014 from www.prestagefarms.com/company/locations

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TDM Farms/Hog Slat
Introduction

TDM Farms is a hog production company with operations in North Carolina, Indiana and Illinois (1). In 2013, TDM was the 24th largest hog farming operation in the United States with 25,500 sows (6). In addition to company owned farms, TDM also operates two research facilities, one in North Carolina and one in Indiana to help test new products and enhance competiveness (1). The company is part of Hog Slat, a manufacturer of hog equipment also based out of the Newton Grove headquarters.

Headquarters: Newton Grove, NC
Total Employees (est. 2012): 600
NC Employees (est. 2012): 360
NC Locations: Newton Grove
Total Revenue (FY 2013): $72.4 million ($6.1 million from TDM Farms)
Year Established: 1969 (1986 TDM Farms)
Primary NAICS: 11221: Hog and Pig Farming
Sources: (1; 2; 3)

Brands & Market Segments

TDM Farms Inc. is one side of the Herring family-owned business. The main enterprise is Hog Slat, a manufacturer of hog equipment whose primary market segment is in farm machinery manufacturing. TDM Farms is a smaller expansion into the production aspect of the industry (4). Hogs sold under the TDM name come from a combination of company owned facilities and contract farms.

Hog Slat is the largest manufacturer of hog equipment in the United States with 600 employees nationwide (3) and an additional 1,400 subcontractors (5). The company offers a full range of equipment and uses operations such as TDM Farms to test products before putting them on the market (1). The company also operates in the poultry sector through its wholly owned subsidiary, Georgia Poultry Equipment Company (5).

Strategy & Competitiveness

The company aims to remain profitable through diverse activates, but focuses heavily on the development and sale of farm equipment. Hog production through TDM Farms is large, the 24th largest in the United States (6) but it a smaller revenue stream than Hog Slat and the company does not have a leading position, compared to its current position in hog equipment manufacturing.

Global Footprint

Hog Slat and TDM Farms Inc. operate mainly on a national level (1). However, the Company is increasingly entering the international market through the equipment segment.

References
  1. Hog Slat (2013). TDM Farms. Retrieved January 16, 2014 from www.hogslat.com/t/TDMFarms
  2. Dunn and Bradstreet Credibility Corp. (2013). TDM FARMS Inc. Credibility Review. Retrieved January 17, 2014 from www.dandb.com/businessdirectory/tdmfarmsincnewtongrove- nc-26237894.html
  3. Hoover’s. (2013). Hog Slat [company overview, family tree]. Retrieved January 17, 2014 from Hoover’s database.
  4. Ter Beek, V. (2012, August 6). TDM Farms: North Carolina, United States. Pig Progress. Retrieved January 17, 2014 from www.pigprogress.net/Home/General/2012/7/TDMFARMS- North-Carolina-United-States-PP009011W
  5. Hog Slat (2013). History. Retrieved January 16, 2014 from www.hogslat.com/t/History
  6. Successful Farming. (2013, December). 2013 Pork Powerhouses. Retrieved January 16, 2014 from www.agriculture.com/uploads/assets/promo/external/pdf/PP2013_03.pdf 

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The Pork Company
Introduction

The Pork Company is a fresh pork plant that operates with many large distributers and retail stores across the globe. Located in Warsaw, NC, the company strives to partner with local producers and esteems the value of small producers in hog farming (1). The Pork Company is a division of the Villari Food Company.

Headquarters: Warsaw, NC
Total Employees (2013): 100
NC Employees (2012): 100
NC Locations: Warsaw, NC
Total Revenue (2013): $7.2 million
Year Established: 2000
Primary NAICS: 311611: Animal Slaughtering (except poultry)
Sources: (2)

Brands & Market Segments

The Pork Company is the processing division of the Villari Foods brand. Villari Foods offers a wide range of pork products and services throughout the value chain from livestock to prepackaged foods (1). Villari runs several divisions, S&J Villari Livestock, which procures hogs from the southeast, Villari Bros Trucking, the distribution side of the organization, Country Fresh Meats, a budget line of pork products sold in a variety of retailers (3). The newest enterprise, Villari Bros Food, opened in 2011 smokes, packages and sales pork products received mainly from The Pork Company.

The Pork Company retails under the Country Fresh Meats brand and the Villari Foods brand (3). It is sold in several regional retail stores including Piggly Wiggly and Food Lion (3).

Strategy & Competitiveness

The Pork Company represents part of the broader strategy for Villari Foods. The strategy is for vertical integration and control of all aspects of the value chain from livestock to final retailing. One of the unique strategies The Pork Company utilizes is contracting with small scale producers to help promote local communities (1).

Global Footprint

The Pork Company/Villari Foods operates primarily in North Carolina with some hog production coming from throughout the Southeast (4). Markets are generally concentrated in the southeastern United States, but is increasingly global with sales in China, Thailand, Dominican Republic, Caribbean, Mexico, Central America, New Zealand and Canada (5)

References
  1. Villari Foods. (2013). Welcome to the Pork Company. Retrieved January 17, 2014 from http://villarifood.com/the-pork-company
  2. Hoover’s. (2013). The Pork Company [company overview, family tree]. Retrieved January 17, 2014 from Hoover’s database.
  3. Villari Foods. (2013). About Us. Retrieved January 17, 2014 from www.villarifood.com/villari-brothers/index.php
  4. Villari Foods. (2013). S & J Villari Livestock. Retrieved January 17, 2014 from www.villarifood.com/s&j-livestock
  5. Villari Foods. (2013). History of the Pork Company. Retrieved January 17, 2014 from www.villarifood.com/the-pork-company/history.php

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