Source:  Rita Jane Gabbett, MEATINGPLACE.COM, 6/9/09

By June 17, hog producers will be able to sign up for the Producer Retirement Program, formed by a group of hog producers in an attempt to make it easier for farmers to exit the hog business.

The PRP is a non-profit organization that will operate like a co-op, Iowa farmer Chuck Witz who is leading the program, explained on a conference call. To become a member, hog producers can either pay $20 per sow upfront, or pay 25 percent up front and finance the other 75 percent over two years.

Membership entitles producers to bid for a reimbursement for liquidating all the sows on a single premise to help ease the potential losses often involved in retiring sows. The group, however, is encouraging producers who plan to stay in the business to also join the PRP to create the funding needed to finance the project.

"We can try voluntarily through this program to remove some of the sows and endure some pain (of increased sow slaughter into the market), or we can endure a lot more pain trying to eat through all the offspring from these sows," said Wirtz, warning the program will die a quick death if not funded.

Details

Under the program, producers will have until July 10 to subscribe and until July 31 to fund their subscription. Bids from producers who want to retire their sow herd will be accepted until July 17. First bids will be awarded July 24, with the lowest bids awarded first.

Bids will be awarded until either the program runs out of money or runs out of bids, with a plan to slaughter about 10,000 to 12,000 sows per week, mindful of not flooding the sow slaughter market, said Wirtz.

The program will only accept sows, not unbred gilts, and any sows within five weeks of farrowing must be kept through weaning before being retired. The producer must not house sows on that premise for two years, but can continue other hog operations. All the sows on a single premise must be retired to participate, but producers with multiple premises can retire a single premise.

There will be three audits and three payment installments involved for bid winners. The first audit will verify the sows have been liquidated, after which 70 percent of the payment will be issued. A one-year audit will release the next 15 percent, and a final audit in two years releases the final 15 percent payment.

Further program details can be found at producerretirementprogram.org.

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