U.S. 2008 – 2013 Pork Industry Productivity Analysis

1. U.S. 2008 – 2013 Pork Industry Productivity Analysis J. Stock1, C. E. Abell1, C. Hostetler2, and K. J. Stalder1 1Iowa State University, Ames, IA 50011-3150 and National Pork Board, Des Moines, IA 50325 2014 Pork Academy Des Moines, IA June 4, 2014

2. Data Description • Production data obtained from a large U.S. data record keeping organization • Agreement with the National Pork Board to share limited information. • Uses: • Quantify the annual production levels and variation associated for several key productivity indicators • Establish industry benchmarks for all swine production phases • Breeding herd • Nursery • Wean – to – finish • Conventional finishing

3. Data Description • Production data obtained from a large U.S. data record keeping organization • Agreement with the National Pork Board to share limited information. • Uses: • Quantify seasonal affects associated with the key productivity indicators • Identify research opportunities that would improve the U.S. pork industry production efficiency

4. Data description • Statistical process • Industry Trends • Raw means and standard deviations were used • Seasonality evaluation • Linear model was used • Fixed effects • Company • Month • Year • Covariates – for nursery, grow-finish, and wean-to-finish • Start age • Start days • Days in facility • Covariates – Sow farm • Weaning age

5. Data description cont’ • Data (records) reported monthly for each production phase • Nursery and finishing data – • Monthly averages are based on animals exiting the facility that month • Sow farm data – • Monthly averages are based on litters weaned in that month

7. Company / farm summary • Increase in the number of companies and farms represented • Tremendous increase in the data volume evaluated • Results in improved information and interpretations that can be made • Companies becoming much more data driven in their decision making process

8. Company / farm summary • Grow-finish and wean-to-finish becoming farms becoming more like their sow farm counterparts • Farm level decisions much more data driven • Continue greater use of data when guiding company decision process regarding: • Employee • Financial • Health • Nutritional • Genetic • Some combination

9. Benchmarking - Why do it? • Compare with other businesses • Within species • Across species • Compare herd performance • Within company • Within country • Etc. • Set goals for improving herd • For a specific trait or several traits

10. Overall Averages

11. Key Productivity Indicator Averages • Means and standard deviations across all farms and operations. • Sow, nursery, wean-to-finish, and conventional grow-finish data • Developed to examine yearly trends across the U.S. Swine industry. • Operations can compare one or a number of KPIs to see if they are above or below average

16. Overall data summary • Finishing mortality has declined over time • Across all data conventional finishing mortality was similar in 2012 and 2013 • Wean –to- finish mortality increased slightly in the same time period - initial effects of PED?? • Market weight continues to increase • Increased by 4 pounds in both conventional finishing 269.2 lbs. (2012) and 272.1 (2013) and wean – to - finish summaries 270.1 lbs. (2012) to 274.0 lbs. (2013). • Days in the finisher has remained relatively constant over last 3 to 4 years

17. Overall data summary cont’ • Nursery performance has change little across the reporting time period • Pigs/mated sow/ year has increased by almost 2 pigs from 2008 to 2013. • Pigs/mated sow/ year was essentially the same between 2012 and 2013. • No improvement since 2011 • Why ?? First signs of PED?? • Again, litters/mated sow/year has changed little during the time period

18. Overall data summary cont’ • Percent pre-weaning mortality has increased. • Increased in 2013 to 17.3% from 15.5% in 2012 • Early signs of PED?? • Represents lost opportunity • Easy to improve?? • Weaning age has increased by 2 days from 2008 to 2013. • 19.7 days in 2008 to 21.9 days in 2013 • Weaning weight has increased by 2 lb.

19. Table descriptions • Tables 6-9 and 14-17 have the average and standard deviation for each key productivity indicator by top 10% and bottom 25% of farms in each production stage, respectively. • Farms in each percentile were determined for each KPI • Farms in each percentile were not the same for each production indicator • The top and bottom were defined as desirable or undesirable for each trait (rather than higher or lower)

20. Top 10%

21. Top 10% summary • Separate out to understand performance levels attained by the very best operations for each KPI. • Demonstrates at least what potential is • Top 10% farms pigs/mated sow/ year was 28.5 • Where are the 30 PSY herds • Demonstrates how difficult it is to achieve and sustain the outstanding performance for any of the KPIs • Recognize that top performance can contribute to reduced trait variation

22. Top 10% summary • Performance is what sets producers / operations apart • Reduced variation can also be important • Caution – by definition variation (standard deviation) should be smaller when the overall group is divided into subgroups. – variation or standard deviation more comparable when comparing two subclasses with each other.

27. Top 10% summary • Separate out to understand performance levels attained by the very best operations for each KPI. • Demonstrates at least what potential is • Recognize that top performance can contribute to reduced trait variation

28. Top 10% summary • Represents above average performance for each KPI. • Does not describe the relationship with other KPIs and ability to maintain all at top 10%. • Can use this to establish goals for certain KPIs • Be sure that when setting goals they are attainable and are achievable in a reasonable time frame. • Realistic if you are in the bottom 25% to expect top 10% performance within 6 months of establish new goals • Goals that are set too high are not seen as incentives by barn workers

29. Top 10% Summary cont’ • Highlights • Conventional market weight tops 300lbs for top 10% for the first time in 2013 • Same value for wean-to-finish was 297 in 2013 • Days to market, ADG, and Feed Conversion essentially unchanged from 2008 through 2013 in conventional and wean-to-finishing operations • Nursery performance KPIs similar from 2012-2013 • Pigs per mated female per year reached 29.5 in the top 10% in 2013 • Pre-weaning mortality remains just above 5% for 2013

30. Bottom 25%

31. Comparison of Top 10% vs Bottom 25% • Conventional Finishing • Huge difference in mortality Top 10% < 2% vs Bottom 25% >10% average across 6 years • Bottom 25% moving in right direction in recent years • Below 9% 3 most recent years • Bottom 25% sell at much light weight than Top 10% • Bottom 25% 254.2 vs Top 10% 298.7 • Net 46 lb. difference at 0.84$/lb. live results in 38.64 for every pig marketed in additional gross income • Bottom 25% have more days in the finisher than the Top 10% • Bottom 25% = 140 vs. Top 10% = 103 • Indicates the bottom 25% growing slower 1.56 vs. 2.00 lbs. • Top 10% has much better feed conversion when compared to the bottom 25%. • Top 10% 2.37 vs. Bottom 25% 3.08

32. Comparison of Top 10% vs. Bottom 25% • Wean-to-Finish Finishing • Early years data may be biased due to small sample number • Huge difference in mortality Top 10% 2.5% vs. Bottom 25% >12% average across 6 years • Finishing weight Top 10% 288 lbs. vs. Bottom 25% 251 lbs. • Bottom 25% averaged over 3 week more days in the finisher • Top 10% 147.1 vs. Bottom 25% 177.5 • Consequently ADG differed between the groups • Bottom 25% 1.62 vs. Top 10% at 2.10 • Top 10% feed conversion was 2.34 while the bottom 25% was 2.98

33. Comparison of Top 10% vs. Bottom 25% • Nursery • Again substantial mortality differences • Top 10% less than 1% (0.84) Bottom 25% 7.90 % • Top 10% nursery exit weight 66.1 lbs. while the Bottom 25% was 39.9 lbs. • Days in the Nursery Top 10% 34.8 vs. Bottom 25% 51.7 • Nursery Average Daily Gain Top 10% 1.07 lbs. /d vs. Bottom 25% 0.67 lbs./d • Feed conversion Top 10% 1.18 vs. Bottom 25% 1.69

34. Comparison of Top 10% vs Bottom 25% • Sow Farm

35. Comparison of Top 10% vs. Bottom 25% • Important to examine variation (standard deviations) between groups • Mortality variation always lower for better performing herds • May be near biological minimum and have less room to improve • Other traits where variation is greater among poorer performing herds • Nursery, Grow-Finish & Wean-to-Finish • Feed conversion • Sow farm • Still born and mummies • Number weaned • Both traits correlated with each other

36. Comparison of Top 10% vs. Bottom 25% • Important to examine variation (standard deviations) between groups • Other traits where variation is greater among better performing herds • Sow farm • Weaning weight • Weaning age • Both traits correlated with each other

37. Additional information available • Plots of averages • Top 25% • Average • Bottom 25% • Examine rate of change over time across relative productivity levels • Seasonality estimates • Monthly averages across time using a more sophisticated statistical model • Seasonality estimates tables – sets one month to average 0 and compares other months relative to the average month • Seasonality summary

38. Full Report • The full report can be found at: www.pork.org/animalscience

39. Thank you for your time and attention ! Do you have any questions or comments?