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Pork producers aren’t living high on the hog

Coharie Hog Farm Inc. of Clinton isn’t the largest pork producer in the state, but its Chapter 11 bankruptcy filing in November may be the clearest example of hard times facing Eastern North Carolina’s pork industry. It’s part of what Don Butler, president of the National Pork Producers Council, calls “the most severe crisis in our industry’s history.”

While demand for corn to produce ethanol has pushed feed costs to record highs, demand for pork has declined due to fear of swine flu. The illness isn’t food-borne, but media coverage of the H1N1 virus sliced into domestic and export markets after reports of flu fatalities in Mexico last April. Several countries banned American pork; China, the nation’s second-largest export market, only recently relaxed its restriction. Iowa State University researcher John Lawrence says farmers nationwide lost an average of $23 on every hog sold since October 2007. In North Carolina, the nation’s No. 2 hog producer, that adds up to about $1.6 billion, including related costs elsewhere in the economy.

Four producers in Eastern North Carolina have filed for bankruptcy. Coharie, the largest of them, lost $13.3 million in 2008 and $17 million this year, according to court documents. The company, founded by former U.S. Sen. Lauch Faircloth and now run by daughter Anne, plans to shut down its 30,000-sow operation and lay off its 170 employees next spring. The impact extends to about 100 farm families who raise grain and hogs on contract to Coharie in 11 North Carolina counties and two in Indiana.

Problems in the pork and poultry industries are rippling through the state, especially Eastern North Carolina, says Kelly Zering, an agriculture extension specialist at N.C. State University. “Cascading financial losses are affecting poultry and swine producers, processors, lenders, grain growers, allied industry, local businesses serving consumers and governments.”

Hog farmers across the nation are reducing their herds, measures that will result in higher pork prices for consumers, says Deborah Johnson, CEO of the North Carolina Pork Council. The council says the economic conditions threaten an industry that generates 22% of all North Carolina farm income.

Financial losses in the U.S. pork industry will decline over the next few months, Zering says, and profits might return by June as producers cut supplies and pork prices rise. That still means at least half a year of suffering. “It’s good news, but it’s also tough.”

ELLERBE — One company recently expanded a textile mill here, and another plans to. Kansas City, Kan.-based Knit-Rite, which makes socks for diabetics, added 24 jobs to the 44 it has here. Richmond Specialty Yarns will add 135 jobs in three years, nearly doubling employment as it increases production of yarn for military, medical and furniture uses.

PINETOPSABBwill spend $4 million to expand its local factory. The Zurich-based transformer maker plans to add 30 jobs when construction is finished next fall. It also will move the 30 employees from its Tarboro office, giving the factory about 300 workers.

CASTLE HAYNEThe state saysTitan America, which wants to build a $450 million cement plant near here, can get its environmental permits before an extensive federal environmental review of the project is completed. The Norfolk, Va.-based company plans to employ more than 160 here. Construction will take about two years.

WILMINGTONDrug tester Pharmaceutical Product Development bought Chinese competitor Excel PharmaStudies for about $20 million. The deal gives PPD about 750 workers in Asia — a gain of 300. It employs about 3,000 in North Carolina.

ROCKY MOUNTHospira will close part of its factory here in July. The Lake Forest, Ill.-based drug and medical-equipment maker says it doesn’t know how the move will affect the plant’s more than 2,000 employees.

ROCKY MOUNTThe city rejected Barcalounger Home’s request to exit its three-year, $10,423-a-month factory lease — signed in March. Within months after the signing, the chair maker closed the plant, eliminated 140 jobs and moved its headquarters to Martinsville, Va.

FAYETTEVILLEBruce Triplett resigned as director of the Veterans Affairs Medical Center here. Patients and employees had complained about care. Ralph Gigliotti, director of the Durham VA Medical Center, was appointed interim director.