Pork industry calls for changes to loan program so more farms qualify

The National Pork Producers Council (NPPC) is urging Congress to raise the employee cap on qualifying businesses from 500 to 1,500 employees to expand its industry’s access to small business loan programs.

About 10,000 family hog farms, which are experiencing plummeting hog values during the coronavirus pandemic, have been left out of the Small Business Administration (SBA) loan programs, according to NPPC. 

Hog farmers will lose nearly $37 per hog, which is about $5 billion collectively, for the rest of the year, according to NPPC data released on Tuesday. Prior to the coronavirus, industry analysts forecasted earnings of about $10 per hog on average for 2020.

“COVID-19 has had a sudden and devastating impact on US hog farmers. We are in crisis and need immediate government intervention,” NPPC President Howard “A.V.” Roth said on a call with reporters on Tuesday.

Pork processor Smithfield Foods closed its Sioux Falls, S.D., pork processing facility “until further notice.” Smithfield is the world’s biggest pork processor and the closed plant accounts for up to 5 percent of U.S. pork production.

The coronavirus has exacerbated an existing harvest facility capacity challenge due to a labor shortage in the U.S. and created a surplus of pigs that has caused hog values to plunge, and the shuttering of restaurants during the shutdown has crashed demand and overwhelmed the cold storage of meat.

NPPC is also seeking over $1 billion in Agriculture Department purchases of pork products and payments to producers to clear out a backed-up meat supply, as well as direct payments to producers without eligibility restrictions and for agricultural businesses to be eligible for the Economic Injury Disaster Loan program.