April 27, 2020 / 9:37 PM / a month ago

INSIGHT-Piglets aborted, chickens gassed as pandemic slams meat sector

    By Tom Polansek and P.J. Huffstutter
    CHICAGO, April 27 (Reuters) - With the pandemic hobbling the
meat-packing industry, Iowa farmer Al Van Beek had nowhere to
ship his full-grown pigs to make room for the 7,500 piglets he
expected from his breeding operation. The crisis forced a
decision that still troubles him: He ordered his employees to
give injections to the pregnant sows, one by one, that would
cause them to abort their baby pigs.
    Van Beek and other farmers say they have no choice but to
cull livestock as they run short on space to house their animals
or money to feed them, or both. The world's biggest meat
companies - including Smithfield Foods Inc          , Cargill
Inc          , JBS USA          and Tyson Foods Inc         -
have halted operations at about 20 slaughterhouses and
processing plants in North America since April as workers fall
ill, stoking global fears of a meat shortage.
    Van Beek's piglets are victims of a sprawling food-industry
crisis that began with the mass closure of restaurants -
upending that sector's supply chain, overwhelming storage and
forcing farmers and processors to destroy everything from milk
to salad greens to animals. Processors geared up to serve the
food-service industry can’t immediately switch to supplying
grocery stores.              
    Millions of pigs, chickens and cattle will be euthanized
because of slaughterhouse closures, limiting supplies at
grocers, said John Tyson, chairman of top U.S. meat supplier
Tyson Foods.             
    Pork has been hit especially hard, with daily production cut
by about a third. Unlike cattle, which can be housed outside on
pasture, U.S. hogs are fattened up for slaughter inside
temperature-controlled buildings. If they are housed too long,
they can get too big and injure themselves. The barns need to be
emptied out by sending adult hogs to slaughter before the
arrival of new piglets from sows that were impregnated just
before the pandemic.
    "We have nowhere to go with the pigs," said Van Beek, who
lamented the waste of so much meat. "What are we going to do?"
    In Minnesota, farmers Kerry and Barb Mergen felt their
hearts pound when a crew from Daybreak Foods Inc arrived with
carts and tanks of carbon dioxide to euthanize their 61,000
egg-laying hens earlier this month.
    Daybreak Foods, based in Lake Mills, Wisconsin, supplies
liquid eggs to restaurants and food-service companies. The
company, which owns the birds, pays contract farmers like the
Mergens to feed and care for them. Drivers normally load the
eggs onto trucks and haul them to a plant in Big Lake,
Minnesota, which uses them to make liquid eggs for restaurants
and ready-to-serve dishes for food-service companies. But the
plant’s operator, Cargill Inc, said it idled the facility
because the pandemic reduced demand.
    Daybreak Foods, which has about 14.5 million hens with
contractor-run or company-owned farms in the Midwest, is trying
to switch gears and ship eggs to grocery stores, said Chief
Executive Officer William Rehm. But egg cartons are in shortage
nationwide and the company now must grade each egg for size, he
said.
    Rehm declined to say how much of the company's flock has
been euthanized.
    "We're trying to balance our supply with our customers'
needs, and still keep everyone safe - including all of our
people and all our hens," Rehm said.
    
    DUMPING HOGS IN A LANDFILL
    In Iowa, farmer Dean Meyer said he is part of a group of
about nine producers who are euthanizing the smallest 5% of
their newly born pigs, or about 125 piglets a week. They will
continue euthanizing animals until disruptions ease, and could
increase the number of pigs killed each week, he said. The small
bodies are composted and will become fertilizer. Meyer's group
is also killing mother hogs, or sows, to reduce their numbers,
he said.
    "Packers are backed up every day, more and more," said
Meyer.
    As the United States faces a possible food shortage, and
supermarkets and food banks are struggling to meet demand, the
forced slaughters are becoming more widespread across the
country, according to agricultural economists, farm trade groups
and federal lawmakers who are hearing from farmer constituents.
    Iowa Governor Kim Reynolds, along with both U.S. senators
from a state that provides a third of the nation's pork, sent a
letter to the Trump administration pleading for financial help
and assistance with culling animals and properly disposing of
their carcasses.
    "There are 700,000 pigs across the nation that cannot be
processed each week and must be humanely euthanized," said the
April 27 letter. 
    The U.S. Department of Agriculture (USDA) said late Friday
it is establishing a National Incident Coordination Center to
help farmers find markets for their livestock, or euthanize and
dispose of animals if necessary. 
    Some producers who breed livestock and sell baby pigs to
farmers are now giving them away for free, farmers said,
translating to a loss about $38 on each piglet, according to
commodity firm Kerns & Associates.
    Farmers in neighboring Canada are also killing animals they
can't sell or afford to feed. The value of Canadian isoweans -
baby pigs – has fallen to zero because of U.S. processing plant
disruptions, said Rick Bergmann, a Manitoba hog farmer and chair
of the Canadian Pork Council. In Quebec alone, a backlog of
92,000 pigs waits for slaughter, said Quebec hog producer Rene
Roy, an executive with the pork council.
    A hog farm on Prince Edward Island in Canada euthanized
270-pound hogs that were ready for slaughter because there was
no place to process them, Bergmann said. The animals were dumped
in a landfill.
    
    DEATH THREATS
    The latest economic disaster to befall the farm sector comes
after years of extreme weather, sagging commodity prices and the
Trump administration's trade war with China and other key export
markets. But it's more than lost income. The pandemic barreling
through farm towns has mired rural communities in despair, a
potent mix of shame and grief.
    Farmers take pride in the fact that their crops and animals
are meant to feed people, especially in a crisis that has idled
millions of workers and forced many to rely on food banks. Now,
they’re destroying crops and killing animals for no purpose.
    Farmers flinch when talking about killing off animals early
or plowing crops into the ground, for fear of public wrath. Two
Wisconsin dairy farmers, forced to dump milk by their buyers,
told Reuters they recently received anonymous death threats.
    "They say, 'How dare you throw away food when so many people
are hungry?'," said one farmer, speaking on condition of
anonymity. "They don't know how farming works. This makes me
sick, too."
    Even as livestock and crop prices plummet, prices for meat
and eggs at grocery stores are up. The average retail price of
eggs was up nearly 40% for the week ended April 18, compared to
a year earlier, according to Nielsen data. Average retail fresh
chicken prices were up 5.4%, while beef was up 5.8% and pork up
6.6%.
    On Van Beek's farm in Rock Valley, Iowa, one hog broke a leg
because it grew too heavy while waiting to be slaughtered. He
has delivered pigs to facilities that are still operating, but
they are too full to take all of his animals.
    Van Beek paid $2,000 to truck pigs about seven hours to a
Smithfield plant in Illinois, more than quadruple the usual cost
to haul them to a Sioux Falls, South Dakota, slaughterhouse that
the company has closed indefinitely. He said Smithfield is
supposed to pay the extra transportation costs under his
contract. But the company is refusing to do so, claiming "force
majeure" – that an extraordinary and unforeseeable event
prevents it from fulfilling its agreement.
    Smithfield, the world’s largest pork processor, declined to
comment on whether it has refused to make contracted payments.
It said the company is working with suppliers "to navigate these
challenging and unprecedented times."
    Hog farmers nationwide will lose an estimated $5 billion, or
$37 per head, for the rest of the year due to pandemic
disruptions, according to the industry group National Pork
Producers Council.             
    A recently announced $19 billion U.S. government coronavirus
aid package for farmers will not pay for livestock that are
culled, according to the American Farm Bureau Federation, the
nation's largest farmer trade group. The USDA said in a
statement the payment program is still being developed and the
agency has received more requests for assistance than it has
money to handle.
    Minnesota farmer Mike Patterson started feeding his pigs
more soybean hulls – which fill animals' stomachs but offer
negligible nutritional value – to keep them from getting too
large for their barns. He's considering euthanizing them because
he cannot find enough buyers after Smithfield indefinitely shut
its massive Sioux Falls plant.             
    "They have to be housed humanely," Patterson said. "If
there's not enough room, we have to have less hogs somehow. One
way or another, we've got to have less hogs."  

 (Reporting By Tom Polansek and P.J. Huffstutter in Chicago.
Additional reporting by Rod Nickel in Winnipeg, Manitoba.
Writing by P.J. Huffstutter; Editing by Caroline Stauffer and
Brian Thevenot)
  
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