F I G S A N D S P A C E
H O G F A R M I N G A N D F O R K P R O D U C T I O N I N T H E E U R O P E A N U N I O N A N D T H E U N I T E D S T A T E S I N T R A N S I T I O N
With 14 figures and 8 tables HANS-WILHELM WINDHORST
Zusammenfassung: Räumliche Strukturen der Schweinehaltung - Strukturwandlungen in der Schweinehaltung und Schweine- fleischproduktion in der Europäischen Union und den USA
Die Schweinehaltung und Schweineflcischproduktion in den Staaten der EU und den USA befinden sich gegenwärtig in einem schnellen Prozeß der Umstrukturierung. Dies bezieht sich sowohl auf die Organisationsstrukturen auf der Ebene der Unternehmen als auch auf die räumlichen Ordnungsmuster. Die Schweinehaltung in der EU ist gegenwärtig durch eine schnelle Abnahme der Zahl der schweinehaltenden Betriebe, eine starke Zunahme der durchschnittlichen Bestandsgrößen und eine Bestandsausweitung in Belgien, Dänemark und den Niederlanden gekennzeichnet. Hinsichtlich der Organisationsstruk- turen der Erzeugung von Schweinen und Schweinefleisch läßt sich eine breite Palette unterschiedlicher Formen feststellen.
Während in einigen Staaten vertikal integrierte Unternehmen mit Hcrkunfts- und Qualitätssicherungssystemen sowie Ver- tragshaltung bestimmend sind (z. B. Dänemark), sind in anderen Staaten erst ansatzweise vergleichbare Strukturen erkennbar.
Die marktorientierte Schweineproduktion hat zu Verdichtungsräumen mit hoher Besatzdichtc und großer Leistungsfähigkeit geführt, aber auch ökologische und seuchenhygienische Probleme nach sich gezogen. Hier sind Neuorganisationen unabding- bar, wenn die Produktionsleistung längerfristig erhalten werden soll. In den USA vollzieht sich gegenwärtig ein dramatischer Strukturwandel. Ausgelöst wurde er durch das Engagement von agrarindustriellcn Unternehmen, die bislang überwiegend in der Erzeugung von Geflügelfleisch tätig waren. Ihre Investitionen haben neue Zentren der Produktion in den südlichen Plains- staaten und am mittleren Atlantik zur Folge gehabt. Demgegenüber verlieren die Staaten im Mittelwesten fortlaufend an Produktionsantcilen, weil es hier nicht schnell genug gelingt, zeitgerechte Organisationsstrukturen umzusetzen.
Summary: Hog farming and pork production in the European Union and the United States are undergoing a rapid transformation process. This is true for the organizational as well as for the spatial pattern. Hog farming in the European Union is characterized by a rapid decrease in the number of farms with hog production, an increasing average herd size, and a fast growing pig population in some member states (Belgium, Denmark, The Netherlands). The swine industry in the European Union shows a broad variety of organizational patterns. Whereas in some states (i. e. Denmark) integrated production systems with quality management and contract farming have reached a mature stage, in other states only first steps in this direction can be observed. Market-oriented pig production has quite obviously led to densely populated areas with high production capacities but also severe ecological problems and a high disease risk. Here, new ways are to be found to initiate a trans- formation process towards sustainable pig production. In the United States, hog farming and pork production arc changing dramatically. Vertically integrated agrobusiness companies which have shown their effectiveness in broiler production in past decades are investing now in pork production. Their investments not only led to huge farms but also caused a regional shift of hog production from the Midwest to some Midatlantic states and states in the southern Great Plains.
1 Introduction
With a pig population of 117.8 mill, the member states of the EU (15) contributed 13.1% to the world pig population (900.6 mill.) in 1995, the United States with 60 mill. 6.7%. Germany with 24.7 mill, animals was the largest pig producer in the EU, Luxemburg with only 73 000 the smallest. Whereas in Great Britain 76.4% of the pigs were held in farms with an average herd size larger than 1,000 places, in Germany only 23.2% fell into this size class. A high regional concen- tration of pig production in some countries, i. e. in the southern provinces of the Netherlands, in northwestern Germany, in Britanny, in France, in Belgium and in some parts of the Po valley in Italy has a counterpart in a much more even spatial distribution in Great Britain, Spain and Denmark. Countries with a high self-suf- ficieny rate for pork which produce mainly for the world market (Denmark 450%, Netherlands 274%)
Table 1: Development of the number of pig farms in selected EU mem- ber states between 1975 and 1995, data in 1,000
Source: ZMP Bilanz Vieh und Fleisch, various editions;
BML, Fleischwirtschaft in Zahlen 1996
Die Entwicklung der Zahl der Farmen mit Schweinehal- tung in ausgewählten Staaten der EU zwischen 1975 und 1995, Angaben in 1000
State 1975 1987 1995 Change (%)
Belgium 58 27 13 -77.6
Denmark 91 38 21 -76.9
Germany* 684 392 239 -65.1
France 500 187 90 -82.0
Italy 1,214 487 237** -80.5
Netherlands 55 35 22 -60.0
Great Britain 45 21 13 -71.1
* figures for 1995 include pig farms in eastern Germany
** figures for 1993
Hans-Wilhelm Windhorst: Pigs and space. Hog farming and pork production in the European Union and the United States in transition 233
Table 2: Development of the pig population in selected EU member states between 1975 and 1995, data in 1,000
Source: ZMP Bilanz Vieh und Fleisch, various editions;
BML, Fleischwirtschaft in Zahlen 1996
Die Entwicklung der Schweinebestände in ausgewählten Staaten der EU zwischen 1975 und 1995, Angaben in 1000 State 1975 1987 1995 Change (%) Belgium 4,647 5,861 7,268 + 56.4 Denmark 7,672 9,266 11,084 + 44.5 Germany* 19,802 24,470 24,674 + 24.6 France 12,068 1 1,91 1 14,531 + 20.4 Italy 8,887 9,383 8,348** - 6.1 Netherlands 7,279 14,349 14,398 + 97.8 Great Britain 7,714 7,915 7,335 - 4.9
* figures for 1995 include pig population in eastern Ger- many
** figures for 1993
are as typical of the EU pig industry as countries with a low sclf-sufficiency rate and a permanent need for high imports (Italy 64%, Germany 77%). These initial remarks already show that it will be necessary to go into more detail if one wants to present a picture of the sectoral and regional patterns and processes of the EU pig industry, a sector of animal production in which agro-industrialization had not been important until the early eighties.
In this paper
- an overview about the development of farms with pig production, the pig population and the average herd-sizes will be given,
the sectoral concentration process in pig produc- tion will be examined and it will be discussed which steering factors led to the high sectoral concentration in some countries,
the spatial pattern of pig production in some major pig producing member states of the EU will be analyzed,
- basic organisational forms of pig production in the EU will be compared,
the interdcpendencies between a wave of agro- industrialization and spatial processes and patterns will be discussed,
the recent development of integrated production systems in U.S. hog farming and pork production will be compared with processes in the EU in order to better understand global congruencies.
2 Sectoral concentration processes in EU pig production Changes in the sectoral concentration of pig farming in the EU can best be demonstrated if one concen- trates on some of the major pig producing countries.
Data for a longer time period are only available for a
Table 3: Development of the average herd size of pig farms in selected EU member states between 1975 and 1995
Source: ZMP Bilanz Vieh und Fleisch, various editions;
BML, Fleischwirtschaft in Zahlen 1996
Die Entwicklung der durchschnittlichen Bestandsgrößen in der Schweinehaltung ausgewählter Staaten der EU zwi- schen 1975 und 1995 '
State 1975 1987 1995 Change (%)
Belgium 80 221 557 + 596.3
Denmark 85 246 518 + 509.4
Germany* 29 62 103 + 255.2
France 24 64 162 + 575.0
Italy 7 19 31** + 342.9
Netherlands 132 406 643 + 387.1 Great Britain 170 383 545 + 220.6
* figures for 1995 include eastern Germany
** figures for 1993
limited number of member states, and only for these the development of the number of farms, the pig population, and the average herd size will be presented.
The number of pig farms in the seven member states which will be analyzed here decreased by 60 to 82% between 1975 and 1995 (Tab. 1). The reduction of pig farms was higher in the seventies and early eighties than in the last decade. The development of the pig population in the seven states differed considerably during the past 20 years (Tab. 2). Whereas the number of pigs almost doubled in the Netherlands, and rose by 44% respectively 56% in Denmark and Belgium, the pig population decreased in Italy and Great Britain.
In Germany, the number of pigs has been hovering around 24.5 mill, for about 10 years in spite of the reunification. Quite obviously, as will be shown later, there is a close interdependency between the increase of the pig population in Belgium, Denmark and the Netherlands and the stagnation in Germany.
A decreasing number of farms with pig production and the increase in pig population led to a sharp rise in the average herd size. T h e Netherlands, Belgium, Great Britain, and Denmark have reached an average of more than 500 pigs per farm (Tab. 3). France, which was only second after Belgium with respect to the relative increase, only reached an average of 162, Germany fell far behind with 103, and this in spite of a considerable number of very large units in eastern Germany, not to speak of Italy with only 31 pigs per farm. T h e dramatic changes that have taken place in the EU swine industry during the past twenty years can best be demonstrated with these figures. A constantly increasing number of large, market-oriented farms is characteristic of pork production in Belgium, Den- mark, the Netherlands and northwestern Germany. O n the other hand, most of the small pigfarms in southern Italy or southern Germany are not competitive in the international meat market.
Eig. 1: Changes in the herd-size pattern in pig production between 1975 and 1995 in selected EU member states
Veränderungen in der Bestandsgrößenstruktur der Schweinehaltung in ausgewählten Staaten der EU zwischen 1975 und 1995
Hans- Wilhelm Windhorst: Pigs and space. Hogarming and pork production in the European Union and the United States in transition 235
Fig. 2: The sectoral concentration process in pig production between 1975 and 1995 in selected EU member states Der sektorale Konzentrationsprozeß in der Schweinehaltung in ausgewählten Staaten der EU zwischen 1975 und 1995
Table 4: The development of self-sufficiency rates for pork in selected EU member states between 1985 and 1996, data in %
Source: ZMP Bilanz Vieh und Fleisch, various editions Die Entwicklung des Selbstversorgungsgrades für Schwei- nefleisch in ausgewählten Staaten der EU zwischen 1985 und 1996, Angaben in %
State 1985 1990 1992 1994 1996
Belgium 144 161 178 197 216
Denmark 374 366 414 468 450
Germany* 86 94 79 77 77
France 81 86 91 101 104
Italy 71 67 65 68 64
Netherlands 272 280 278 283 274
EU** 102 105 103 107 107
* data from 1990 on include eastern Germany
** EU (12)
In Figure 1 the changing herd size pattern between 1975 and 1995 is shown. Quite obviously there is a general trend towards a higher share of farms with more than 1,000 places. Their share is particularly high in Great Britain and Italy, followed by the Netherlands and Denmark. In contrast farms of this size only con- tribute about 23% to the pig population of Germany.
A closer look at the graphs shows that the change in the size patterns differed considerably between the single states. One general trend can be observed, however: between 1975 and 1983 the number of large pig farms increased much slower than between 1983 and 1995. The distances between the positions for the single years within the triangle are a good indicator for the change of the sectoral pattern and the recent dynamic. The sectoral pattern of pig production in Italy can be characterized as bimodal. A large number of small pig farms, located in central and southern Italy, is mostly serving local markets, whereas large and highly-specialized farms in the Po valley are pro- ducing for the national and even international market.
A similar pattern can be found in Germany. Here, large, market-oriented pig farms are concentrated in the Weser-Ems-Region and northern Westphalia (c.f.
Fig. 6).
A second series of graphs (Fig. 2) shows the devel- opment of the sectoral concentration process in pig production for the same countries. With the so-called Imenz curve two related parameters (here: number of pig farms and pigs held in these farms) can be described. If, for example, the herd sizes in a particular region would be the same, the graph would be a straight line (the indicated diagonals in the squares).
This would mean that for example 30% of the farms would also hold 30% of the animals. If, however, the herd sizes differ, the degree of concentration can be observed from the curve.
One can easily see that the sectoral concentration is very high in Italy and France. This means that a
Table 5: The development of pork imports of the Federal Republic of Germany between 1988 and 1995, data in tons
Source: ZMP Bilanz Vieh und Fleisch, various editions Die Entwicklung der Schweinefleischimporte der Bundes- republik Deutschland zwischen 1988 und 1995, Angaben in t
State 1988 1992* 1995*+ Change (%) Belgium 84,830 223,871 322,490 + 280.2 Denmark 89,499 208,035 225,110 + 151.5 Netherlands 327,245 356,083 336,065 + 2.7 France 21,674 41,369 52,812 + 143.7 EU total 597,988 939,389 1,070,640 + 79.0 Total 623,682 961,692 1,079,513 + 73.1
* data include eastern Germany
+ partly preliminary data
comparatively large numer of small farms holds only a small amount of the total pig population whereas a small number of large and very large farms hold the majority of the pigs. In contrast to this sectoral pattern the distribution is much more regular in Bel- gium, Denmark, the Netherlands, and Great Britain.
Germany, too, shows a quite regular distribution pat- tern, it could be shown, however, that the average pig farm in this country is much smaller than in Denmark, Belgium or the Netherlands. So only the combination of Figure 1 and Figure 2 is able to present a complex picture of the sectoral pattern of pig production in each state.
There is a close interdependency between the devel- opment of production costs and the sectoral pattern of pig production. It can be summarized that:
the constant oversupply with pork in the EU (Tab. 4) led to lower gains per delivered pig,
in order to maintain a certain income level, far- mers expanded their herds,
in some states, the adaption process showed a strong dynamic, whereas in other countries, especially Germany, changes in the sectoral pattern were much slower,
Germany's rate of self sufficiency for pork decreased constantly and reached a level of only 77%
in 1996; farmers and packers in the Netherlands, Bel- gium, and Denmark were able to increase their exports and to gain considerable market shares (Tab. 5),
not price advantages alone, however, were the reason for this development; joint production systems, a guaranteed quality and the documentation of quality control in the whole production chain also played an important role.
3 Changing spatial patterns of pig production in the EU Pig density in the member states of the EU differs considerably (Tab. 6). No matter if one uses density per
Hans-Wilhelm Windhorst: Pigs and space. Hog farming and pork production in the European Union and the United States in transition 237
less than 50
Fig. 3: Pig density in EU member states (1990) Source: HUIRNE et al. 1996, p. 31
Schweinedichte in den Staaten der EU (1990) 100 hectares of total land area or per 100 hectares of
agricultural land, the result is the same: T h e Nether- lands, Belgium, Denmark and Germany are countries with a high pig density, whereas all the other member states show a much lower density. In order to get a more realistic impression of the density on a meso-scale, HUIRNE et. al ( 1 9 9 6 , 31) d e v e l o p e d a m a p o n t h e b a s i s of the statistical regions used by Eurostat (Fig. 3). This map shows that in 1990 high-density areas, those with more than 200 pigs per 100 hectares, were to be found in almost all provinces of Denmark, in northwestern Germany, the southern provinces of the Netherlands, parts of Belgium and in Brittany in France.
In several research projects spatial patterns of pig production and their dynamic were analyzed in Den- mark, the Netherlands, Lower Saxony and Northrhine- Westphalia in Germany (WINDHORST 1 9 9 5 a, 1 9 9 5 b, 1996 a, 1996 b). In Noord-Brabant, Limburg, Gelder- land and Overijssel, the centre of pig production in the Netherlands, densities between 873 (Overijssel) and
2314 pigs/100 hectares of agricultural land (Noord- Brabant) can be observed (Fig. 4). No other region with intensive pig production in Europe reaches an average density similar to that of Noord-Brabant. In Den- mark the pig population is more evenly distributed, according to Figure 5. T h e highest density show Born- holm, Viborg, and Ringkobing. T h e number of pigs per 100 hectares is much lower, however, than in the Dutch centres. T h e density reaches values between 631 (Bornholm) and 515 (Ringkobing) respectively 516 pigs per 100 hectares of agricultural land in Viborg.
But there is no province in Denmark, except for the Copenhagen region, with values below 200. How the Danish swine industry was able to reach this even spatial distribution will be discussed in the following chapter.
Pig production in Northrhine-Westphalia is con- centrated in the northern counties (.Landkreise) of West- phalia (Fig. 6). Here, six counties show a density of more than 500 pigs per 100 hectares, the highest
Fig. 4: Pig population and pig density in the Netherlands (1994) Source: WINDHORST 1995 b
Schweinebestände und Schweinedichte in den Niederlanden (1994)
density is reached in Coesfeld with 860 pigs. In Lower Saxony the pig population is concentrated in the southern counties of the Weser-Ems-Region and some adjacent counties to the east. Vechta is the only county in Germany that reaches an average density of more than 1000 pigs per 100 hectares. The northern counties of Westphalia and the adjacent counties in the southern part of the Weser-Ems-Region form the centre of German pig production. Here, in 1 1 counties, more than 28% of the German pig population (1996:
24.3 mill.) are concentrated. Figure 7 shows the wide range of pig density in these two states (Bundesländer).
Counties with a very high density and large average herd sizes in the northwestern part of Lower Saxony and northern Westphalia are in sharp contrast to many counties with a very low density. Here, the average pig farmer often holds less than 100 animals. Neither Den- mark nor the Netherlands show a similar range in the size pattern of pig production.
The four maps (Fig. 4 to 7) show quite impressively that it is not sufficient to deal with data on the basis of the Eurostat regions to describe the spatial pattern of pig production in the EU but that it will be necessary to go back to the county or even community level in order to identify areas of highest density. Together with the analysis of the animal mix in these areas, the average herd size and the distances between livestock farms, one should be able to classify them according to their disease risk or local environmental problems. This, however, will not be discussed in this paper in detail.
Economies of scale that result from large herd sizes and the development of joint production systems may find their limitations because of the shortage of agri- cultural land on which the manure can be applied so that other cost-intensive methods have to be used to handle the oversupply with manure. That this problem can become so important that it will decide about the future economic development and the competitiveness
Hans-Wilhelm Windhorst: Pigs and space. Hogarming and pork production in the European Union and the United States in transition 239
Fig. 5: Pig population and pig density in Denmark (1994) Source: WINDHORST 1996 a
Schweinebestände und Schweinedichte in Dänemark (1994) of an area, can easily be seen in some counties of the
Weser-Ems-Region in northwestern Germany and the southern provinces of the Netherlands. Recent out- Table 6: Pig population and pig density in EU-countries (December
1992)
Source: after HuiRNE, HOPMANN, STELWAGEN and DIJK- HUIZEN 1996, 20)
Schweinebestande und Schweinedichte in den EU-Staaten (Dezember 1992)
Country Pig popula- Share Pig density
tion (pigs/100 ha)
1,000 % total land agric. land
Germany 26,514 24.2 74 156
Spain 18,219 16.7 36 73
The Netherlands 13,709 12.5 410 677
France 12,564 11.5 23 45
Denmark 10,345 9.5 240 370
Italy 8,244 7.5 27 53
Great Britain 7,704 7.0 32 46
Belgium 6,903 6.3 226 504
Portugal 2,547 2.3 28 76
Ireland 1,423 1.3 21 29
Greece 1,099 1.0 8 29
Luxembourg 66 0.1 26 52
Total (EU-12) 109,338 100.0 46 95
breaks of classical swine fever (CSF) in the centres of pig production in Belgium (1993-1994), Germany (1993-1995) and the Netherlands (since 1996) have shown that these densely populated livestock areas can cause increasing financial burdens for the individual farmers, the member states and the EU because of the stamping out method which is used to control the disease.
4 Organizational patterns of pig production in the EU in transition
Whereas integrated production systems in the poul- try industry have reached a mature stage in most of the industrialized countries (WINDHORST 1989) and even in third world countries, similar systems in the swine industry have not yet emerged in all member states of the EU. Figure 8 shows some basic organizational patterns of pig production. In Germany, for example, farms with sow keeping very often do not finish the piglets but sell them to specialized finishing operations.
This means long shipping distances for piglets from the centres of sow keeping in southern Germany to the centres of finishing in northwestern Germany. The two counties of Cloppenburg and Vechta alone have to import about 1.6 mill, piglets every year. This does not only mean that there may be a mingling of various
Fig. 6: Pig population in Lower-Saxony and Northrhine-Westphalia (1994)
Source: Niedersächsisches Landesamt für Statistik; Nordrhcin-Wcstfalen, Landesamt für Datenverarbeitung und Statistik Schweinebestände in Niedersachsen und Nordrhein-Westfalen (1994)
races but that the risk of a disease transfer is very high.
The outbreak of the classical swine fever in 1993 in this area undoubtedly resulted from the spatial separation of piglet production and finishing. A change of the organizational, sectoral and spatial patterns will be necessary but there is still a long way to go as could be shown in Chapter 1. One must not forget that the Ger- man type of pig production and its spatial organization
were developed under the protecting shield of vaccina- tion and that mental barriers have to be removed before new patterns can be reached.
A leading position in the organization of pork production within the EU is held by Denmark. Even though it will not be possible to give a detailed analysis of the transformation process in the Danish swine industry, it will be necessary to present some basic facts
Hans- Wilhelm Windhorst: Pigs and space. Hog farming and pork production in the European Union and the United States in transition 241
Fig. 7: Pig density in Lower-Saxony and Northrhine-Westphalia (1994)
Source: Niedersächsisches Landesamt für Statistik; Nordrhein-Westfalen, Landesamt für Datenverarbeitung und Statistik Schweinedichte in Niedersachsen und Nordrhein-Westfalen (1994)
of the integrated production system in order to explain why Denmark has been so successful on the European and world pork market. When in the late 1970s a political decision was reached in Denmark to become one of the leading pork producers, it was clear to the decision makers that a restructuring not only of the primary production but also of slaughtering, processing and marketing would be inevitable. Within a short
period of time, an integrated production system was established under the leadership of Danske Slagterier, the federation of Danish pig producers and slaughter- houses. T h e guidelines in this transformation process were documentation of the production chain and quality management. T h e cooperatives were able to convince the pig producers that it was necessary to install integrated production systems in order to guar-
A B
Table 7: Changes in the size structure of pigfarms in Denmark between 1975 and 1995
Source: DANSKE SLAGETERIER (ed.): Statistics, various editions
Die Veränderung der Bestandsgrößenstruktur der däni- schen Schweinehaltung zwischen 1975 und 1995
( Î ) Breeding ( g r a n d p a r e n t s ) ( 2 ) Farrowing unit
Nursing unit ( 3 ) Finishing unil
Fig. 8: Basic organizational patterns in the swine industry Source: WINDHORST 1996d
Grundformen der Organisation der Schweineproduktion
antee defined quality standards. Only four races were permitted, the flow of the piglets was controlled, the fattened pigs had to be delivered within a certain weight-limit and with a certain meat percentage in order to receive an optimum price. In addition to that, strict regulations were set up with respect to the pig density per hectare of agricultural land and the amount of feed that a farmer was allowed to buy from outside in order to avoid environmetal problems resulting from an oversupply of manure. The four cooperatives tried to make use of the advantages of a vertically integrated production system on a national basis (Fig. 9). Because of the close linkages between specialized farms with sow keeping and those with only pig finishing the risk of disease spreading could be reduced considerably.
Contracts between pig farmers and the slaughterhouses had the effect that between 95% and 98% of the installed capacity were used permanently and that the packing plants were able to optimize their own produc- tion and marketing.
Parallel to the reorganization of the production sytem the spatial pattern of the Danish swine industry was adapted to the transformation process. In order to fully profit from economies of scale, the number of slaughterhouses was reduced from 60 in 1970 to only 22 in 1996. Facilities were completely modernized and their capacities were extended. In 1996 the average annual capacity of a slaughterhouse was 855,000 hogs.
The slaughterhouses are evenly distributed over the country (Fig. 10). Obviously, the four cooperatives tried to avoid an overlapping of their tributary areas. In addition with the price regulation system (the same
Delivered pigs per supplier 1975 1985 1995
1-200 37.7 12.3 3.7
201-500 32.7 16.7 6.3
501-1,000 18.9 21.7 11.4
1,001-2,000 8.1 27.5 22.4
2,001-3,000 1.9 11.7 17.5
3,001-4,000 0.4 4.9 11.3
4,001-5,000 0.4* 2.2 7.9
5,001-10,000 — 2.5 15.2
10,001 and more - 0.5 4.2
Total 100.0 100.0 100.0
* 4,000 and more
price is paid for a hog with a certain weight and meat percentage at all Danish slaughterhouses), this spatial pattern has the effect that a farmer always delivers his fattened pigs to the closest slaughterhouse. Short trans- portation distances, low mortality rates, low weight losses, and a better meat quality are the results, a high competitiveness on international meat markets the economic advantage.
An advertizing campaign in the late eighties and early ninenties which focused on the quality man- agement system, low rates of imported feed from developing countries and herd sizes adapted to the available agricultural land on the farm level marked the beginning of the success story of Danish pork produc- tion. What it did not show, however, was the dramatic transformation process in the size of pig producing farms (Tab. 7) and several years of relatively low income for the farmers. In order to be able to gain market shares on the Central European pork market low prices were inevitable. Once the advantages of the Danish way to produce high quality pork was realized prices could be raised.
Some of the leading meat companies in Belgium, the Netherlands, and Germany, and not only in these countries, learned from the Danish success and started to transform their own production systems. Whereas packers in Belgium and the Netherlands (c.f. DEN OLJDEN et al. 1997) have been able to install similar systems within very few years, in Germany only a small number of companies was able to set up integrated production systems. In this country a strong opposi- tion from the pig farmers can still be observed, this is one explanation for the loss of market shares and a decreasing self-sufficiency rate for pork.
In the Netherlands, as a reaction to the Danish success, a new company was formed in July 1995,
Hans- Wilhelm Windhorst: Pigs and space. Hogarming and pork production in the European Union and the United States in transition 243
DANSKE SLAGTERIER The Federation of Danish Pig Producers and Slaughterhouses
Meat Research Institute (Roskilde) Research. Consulting. Advertising
Danish Crown 12 Slaughterhouses
Vestjyske 7 Slaughterhouses
Steff-Houlberg
2 Slaughterhouses TiCan
1 Slaughterhouse
Fig. 9: The integrated production system of the Danish swine industry (1995) Source: Danske Slagterier, WINDHORST 1995 a
Das integrierte Produktionssystem der dänischen Schweineproduktion (1995) named Dumeco (Dutch Aleut Company). It was a merger
of two cooperatives (Coveco and Encebe) and a private company (Gupci). The primary goals of this merger were economies of scale, a better usage of the installed slaughterhouse capacity, a new organizational pattern of the company (vertical integration), the implementa- tion of a total production chain control and an inte- grated quality management system. In 1996, Dumeco with more than 6 mill, slaughtered pigs contributed about 35% of the total Dutch production. In order to be able to control the whole production chain, Dumeco completed the vertical integration in a series of steps. In March 1996, the Cooperatie Dumeco u. a. was founded in order to intensify the cooperation between livestock suppliers and the Dumeco slaughterhouses und meat processing facilities. About 16,000 farmers belong to this cooperative. In April 1996, the take- over of Freshold b.v. was completed. This enabled the company to increase the activities in the fresh meat and further processed meat sector. About 300 stores (Vleeschmeesters, Freshcorp) in the Netherlands and Bel- gium were integrated. Towards the end of the year Dumeco Breeding b.v. was formed. This is a nationwide pigfarm organization aimed at the improvement of breeding and the stabilization of meat quality. This subcompany has a national market share for sows of
about 35%. The management of Dumeco is of the opinion, similar to Danske Slagterier, that the Dutch swine industry will be able only by means of total chain control and integrated quality management systems to avoid losses of market shares in the international
Table 8: The development of the hog population in selected states of the United States between 1980 and 1996, data in 1,000
Source: USDA, Agricultural Statistics 1982, 1992, 1997 Die Entwicklung der Schweinebeständc in ausgewähl- ten Staaten der USA zwischen 1980 und 1996, Angaben in 1000
State 1980 1990 1996 Change (%) Illinois 6,600 5,700 4,400 33.3 Indiana 4,600 4,400 3,750 18.5 Iowa 16,100 13,800 12,200 - 24.2 Kansas 1,900 1,500 1,450 - 23.7 Nebraska 3,900 4,300 3,600 - 7.7
Ohio 2,150 2,000 1,500 30.2
North Carolina 2,460 2,800 9,300 + 278.0 Oklahoma 350 215 1,320 + 277.1
Utah 58 33 163 + 181.0
USA 64,512 54,477 56,171 - 13.1
C o - o p e r a t i v e s l a u g h t e r h o u s e s A Sow s l a u g h t e r h o u s e s
M e a t p r o c e s s i n g and O a d m i n i s t r a t i o n e x d
s l a u g h t e r i n g of pigs _ M e a t T r a d e School and
M e a t R e s e a r c h I n s t i t u t e
Fig. 10: The spatial pattern of the Danish pork industry (1996) Source: Danske Slagterier Statistics 1996
Die räumliche Ordnung der dänischen Schweinefleischerzeugung (1996)
pork market. Figure 11 shows the location of large slaughterhouses in the Netherlands and the spatial organization of Dumeco.
In Germany, a new initiative towards integrated pork production was started in 1997. Funded by the Ministry of Nutrition, Agriculture and Forestry of Lower Saxony, meat companies and feedmills which are located in this state, a project Integrierte Fleischproduk- tion (IFP; integrated meat production) started in Sep- tember. Pig farmers, slaughterhouses, meat processing companies and feedmills, mostly from the northern parts of Lower Saxony, realized that it would be neces- sary to cooperate in order to avoid further losses of
market shares. Similar to Danish and Dutch systems, total chain control and integrated quality management form the center of the initiative. From the beginning, data collection, data evaluation and quality improve- ment on the basis of the collected data will play an im- portant role. A continuous horizontal and vertical flow of information between the links of the production system will help to detect problems and to improve and optimize the system. It is obvious that control of the final product will be substituted by system control.
This new initiative goes further than the activities of some meat companies in northwestern Germany which some years ago started to produce a premium
Ha- Wilhelm Windhorst: Pigs and space. Hog farming and pork production in the European Union and the United States in transition 245
Fig. 11: Slaughterhouses with an annual capacity of more than 100,000 hogs in the Netherlands (1996) and the spatial organization of Dumeco b.v. (1997)
Source: Product Board of Livestock, Meat and Eggs; Dumeco, Annual Report 1996; Dumeco, Company data
Schlachthäuser in den Niederlanden mit einer Kapazität von mehr als 100 000 Schweineschlachtungen pro Jahr und räumliche Organisation der Dumeco b.v.
quality in controlled chains. They have not been able so far to install a system of horizontal and vertical data (lows to document the whole production process; they were able, however, to link together pigfarmers and slaughterhouses on a contract basis. A comparison of Figure 6 and Figure 12 shows the congruency of the areas of high pig population and of large slaughter- houses. Here, the basic conditions for the development of joint production systems are more favourable than in any other part of Germany. Ongoing research projects will document the resulting spatial reorganization in one of the centres of European pig production.
5 Recent trends in hog farming and pork production in the United States
Agricultural production in the United States has undergone several waves of industrialization, in plant production as well as in animal production. Several of these industrialization processes were documented in d e t a i l (GREGOR 1 9 8 2 ; FITZSIMMONS 1 9 8 6 ; W I N D - HORST 1989). H e n c e it is o f i n t e r e s t t o a n a l y z e s i m i - larities and differences between European and US transformation processes in order to better understand
interdependencies between sectoral and regional con- centration processes and developing spatial patterns.
Whereas the industrialization of beef, egg and poul- try meat production reached a mature stage in the e i g h t i e s (REIMUND, MARTIN a . M O O R E 1 9 8 1 ) , h o g farming and pork production arc facing the first years of a revolutionary change in their organizational pattern, the size of pig farms, and the spatial pattern (BENJAMIN 1 9 9 7 ; H U R T 1 9 9 4 ; SOUTHARD a . REED
1 9 9 5 ; UFKES 1 9 9 5 , 1 9 9 7 ; WINDHORST 1 9 9 6 c ) . I t is obvious that the centre of pig production, the former Corn Belt, is losing market shares. New facilities are either built at the southeastern rim of the Corn Belt states, especially North Carolina, or, as an absolutely new development, in the central and southern Great Plains and the Rocky Mountains, here above all in Texas, Colorado, Kansas, Oklahoma, and Utah.
In a recent analysis FURUSETH (1997) showed that hog farming in eastern North Carolina "has been radi- cally transformed: corporately, organizationally, and geographically". Within five years the hog population more than doubled from about 4 mill, to nearly 9 mill.
The forming of a high density area in the southern coastal plain was the result of the decision of several companies to install vertically integrated production
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Fig. 12: Slaughterhouses with an annual capacity of more than 100,000 hogs in Lower-Saxony and Northrhine-Westphalia (1997)
Source: Company data
Schlachthäuser in Niedersachsen und Nordrhein-Westfalen mit einer Kapazität von mehr als 100 000 Schweineschlach- tungen (1997)
systems close to the markets of the northeastern and central Atlantic states. Figure 13 shows, similar to the Netherlands or northwestern Germany, the spatial congruency of high pig population areas and the location of slaughterhouses.
In the western part of the United States it all began in the late eighties when National Farms farms bought a
large cattle farm in Weld County (Col.) and built three farrowing and finishing units with 5,600 sows and 50,000 hogs each. Per year this farm can produce more than 320,000 fattened pigs which are sold in California and Mexico (c.f. WINDHORST 1990). The success of this experiment resulted in several other very large hog farms in the Texas Panhandle, southwestern Kansas,
Hans- Wilhelm Windhorst: Pigs and space. Hog farming and pork production in the European Union and the United States in transition 247
Fig. 13: Hog population (1995) and hog production infrastructure in North Carolina Source: after FURUSETH 1997
Schweinebestände (1995) und Lage der Infrastruktureinrichtungen im Bereich der Schweineproduktion in North Carolina and Utah. There was one disadvantage, however,
no modern packing plant for hog slaughtering was available in any of these states.
In 1993, Seaboard Farms, a diversified multinational company, up to then engaged mainly in the broiler sector, bought an abandoned packing plant for beef production in Guymon (Oklahoma) and announced that this plant would be remodelled to a slaughterhouse for hogs with an annual capacity of 2 mill, hogs in a first step (1996) and 4 mill, hogs towards the end of the decade. Seaboard plans to produce all hogs within a circle with a radius of 250 km and Guymon in its centre. This will completely change the agricultural pattern in the central Great Plains. Availability of feed, a low population density, a favourable climate, access to markets in California, Mexico, and Southeast Asia were the most important pull factors. Seaboard is con- vinced that only an integrated system of this type will be able to produce high quality pork which meets the demands of the market. Quite obviously the leading
companies in the development of integrated produc- tion systems (Tyson, Seaboard, Smithfield) are transferring a successful and effective pattern from the broiler industry to hog production (Fig. 14). They are installing these systems outside the Corn Belt as legal regulations in some of these states prohibit vertically integrated agrobusiness companies and a strong opposition of very conservative corn and soybean farmers make con- tract farming almost impossible. New organizational patterns will result in a new spatial pattern and the Corn Belt will lose market shares in another important field of animal production, namely pork (Tab. 8), after having already lost most of the beef production in the sixties and seventies (c.f. WINDHORS T 1996e).
6 Summary and perspectives
The main results of this analysis can be summarized as follows:
Market Pork Processed Products Convenience Products
Fig. 14: Matured system in U.S. pork production
Reifestadium eines Produktionssystems für Schweinefleisch in den USA
Hog farming in the EU is characterized by a rapid decrease in the number of farms, a fast growing pig population in Belgium, Denmark, and the Netherlands, and increasing average herd sizes.
The sectoral concentration of pig production in EU member states differs considerably, the highest con- centration is to be found in France and Italy.
- The swine industry in the EU is up to now charac- terized by a broad variety of organizational patterns.
In Denmark, an integrated production system with contract farming has reached a mature stage. In other European states the success of this system has initiated transformation processes towards systems with inte- grated quality management and disease prevention, especially in Belgium and the Netherlands, whereas in Germany this adaption process is still in its initial phase.
- Obviously market-oriented pig production has led to densely populated areas in northwestern Germany, the southern provinces of the Netherlands, parts of Belgium, Brittany in France, and parts of the Po valley in Italy. Here, a spatial congruency of densely popu- lated hog farming areas and the locations of slaughter- houses and meat processing plants can be observed.
These areas developed because of considerable eco- nomic advantages, but they also give rise to an increased risk of animal disease epidemics and serious environmental problems so that despite the immediate economic advantages these areas may prove to be unsustainable in the long term.
- In contrast to this, hog farming, slaughterhouses and meat processing plants are more evenly distributed
in Denmark. Economic as well as ecological aspects led to this spatial pattern.
In the United States, hog farming and pork pro- duction are changing dramatically. Vertically inte- grated agrobusiness companies which have demons- trated their effectiveness in the broiler industry are duplicated in pork production. Economies of scale, disease prevention, market access, and quality man- agement are the main steering factors behind the formation of very large production units; availability of feed, land, and labour as well as a favourable climate, a low population density and political support cause the regional shift to the central and southern Great Plains.
A final comparison of the ongoing organizational and spatial transformation processes in selected EU member states and the United States shows similarities and differences. Sectoral concentration processes and the formation of vertically integrated agrobusiness companies, which can be addressed as a new wave of industrialization of agricultural production, are to be found in the United States as well as in the leading states with pig farming in the EU. Whereas in Europe this transformation process was started by Danish cooperatives, in the United States privately owned meat companies or large corporations with a long experience in broiler production and nationwide poul- try meat marketing initiated the restructuring of hog farming and pork production.
The resulting spatial organization shows two dif- ferent patterns. One type can be characterized by a
Hans- Willm Windhorst: Pigs and space. Hogfarming and pork production in the European Union and the United States in transition 249
regional concentration of large, market-oriented hog farms, slaughterhouses and meat processing com- panies. Environmental problems resulting from an oversupply of manure and a high disease risk may prove that regions which belong to this type (parts of northwestern Germany, the southern provinces of the Netherlands, Brittany in France, parts of Flanders in Belgium, and the southern coastal plain of North
Carolina) will not be sustainable in the long term. A second type can be characterized by a more even distribution of hog farms, slaughterhouses and meat processing companies. Denmark and some states in the southern Great Plains show this spatial pattern, they differ, however, considerably in the average size of the hog farms, a consequence of the availability of agri- cultural land on the level of the single farm.
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