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MARCH 25, 2008
A GENERAL OVERVIEW OF THE U.S. MEAT PACKING INDUSTRY 
                The meat packing industry is the largest segment of the U.S. Agriculture industry which slaughtered and processed more than 8.5 billion cattle, hogs, chickens, sheep/lambs and turkeys in 2007. Annual sales for this sector of the agriculture industry approached $100 billion in 2007.  By sales the following handful of companies controlled some $80 billon of those sales: Tyson Foods, ConAgra, Smithfield Foods, Swift & Co. (now owned by South American giant JBS S.A.), Excel owned by private company Cargill, Hormel, Sara Lee Red Meat/Food Division, privately owned Perdue Farms, Pilgrims Pride and its recently acquired subsidiary Gold Kist. Said companies are among the world’s largest slaughterers and processors of beef, hogs, poultry, sheep and lamb and employed more than 300,000 of the industry’s 450,000 employees. The production and sales of the meat packing industry is highly concentrated into the hands of the few companies listed below.

Ranking by Sales
Company
Product
Public or Private Co.
1
Tyson Foods
Cattle, Hogs, Poultry
Public
2
ConAgra
Cattle, Hogs, Poultry
Public
3
Smithfield Foods
Cattle, Hogs, Poultry
Public
4
Cargill Meat Solutions
Cattle, Hogs, Poultry
Private
5
Swift/JBS S.A.
Cattle, Hogs, Poultry
Foreign Owned
6
Pilgrims Pride/Gold Kist
Poultry
Public
7
Geo. Hormel
Cattle, Hogs, Poultry
Public
8
Perdue
Poultry
Private
Source: Hoovers & SEC
           
 It should be noted that not only have the sales and production fallen into the hands of fewer and fewer companies but unlike the 1970s and 1980s today’s giants are slaughtering, processing and producing brand name products for multiple species, whereas in the past a company specialized in handling and selling one specie of animal. This, of course, further concentrates power into the hands of fewer companies. It should also be pointed out that the concentration of sales and production has, in large measure, come by acquisitions.   

ANNUAL COMMERCIAL SLAUGHTER

Cattle

 

Hogs

 

Poultry

 

Sheep

 

32.4 Million

 

103.6 Million

 

2 Billion

 

2.7 Million

 

24.8 Billion Lbs.

 

20.7 Billion Lbs.

 

10.8 Billion Lbs.

 

191 Million Lbs

 

Source: U.S. Depart of Agriculture, USDA

            In 2006, there were 807 beef slaughter and processing plants, of this number, just 13 slaughtered and processed 60 percent of the nation’s cattle. In the same year there were 631 hog slaughtering and processing plants, of which just 13 slaughtered more than 60 percent of the hogs. Also in this same year, there were 289 poultry plants of which three companies slaughtered and processed 70 percent of the nation’s poultry. Some 55 percent of the nation’s cattle, hogs and sheep come from Iowa, Kansas, Nebraska and Texas . According to the USDA, 98.3 percent of the red meat and poultry slaughter is USDA inspected.

U.S. Per Capita Meat Consumption (Pounds)

Year

 

Chicken

 

Turkey

Veal

 

Lamb

 

Beef

 

Pork

 

1950

 

21

 

3

 

7

 

4

 

44

 

65

 

1960

 

28

 

5

 

5

 

4

 

59

 

59

 

1970

 

40

 

6

 

2

 

3

 

82

 

55

 

1980

 

47

 

8

 

2

 

1

 

75

 

57

 

1990

 

61

 

14

 

1

 

1

 

66

 

49

 

2000

 

77

 

14

 

1

 

1

 

67

 

51

 

2007

 

87

 

17

 

1

 

1

 

66

 

51

 

Source: U.S. Depart of Agriculture, USDA

Disposal Personal Income Spent On Food At Home and Outside the Home

1936

 

1946

 

1956

 

1966

 

1976

 

1986

 

1996

 

2006

 

21.8%

 

21.6%

 

18.1%

 

14.8%

 

13.6%

 

11.6%

 

10.4%

 

9.9%

 

Source: U.S. Depart of Agriculture, USDA 

From High Wage Industry to Low Wage Industry During the 1950s, 1960s, 1970s and up to 1984, meat packing was one of the highest paying industries in U.S. manufacturing. From 1984 until the present, meat packing has been one of the lowest paying industries in manufacturing. Industrywide employer attacks for mid-term contract concessions during the 1980s, and local by local union bargaining in a national industry during the 1990s through the present, has taken UFCW and the packinghouse workers from their strongest bargaining position to their weakest position in meat packing. 
Meat packing was also one of the most highly organized industries in U.S. manufacturing; however, the percent of union workers in this industry has plunged from 80 percent in 1980 to less than 50 percent today. In right-to-work states such as South Dakota, Texas, Kansas, Nebraska, and Iowa where there are large numbers of packinghouse workers, union membership in some plants ranges from 10 to 30 percent.
 
The Long March Backward for Packinghouse Workers
 Historically wage progress in the meat packing industry has been compared with the average hourly earnings in U.S. manufacturing. Monthly and yearly average hourly earnings are calculated by the U.S. Department of Labor, Bureau of Labor Statistics. Historically, the average hourly earnings in meat packing have exceeded those in U.S. manufacturing sometimes by as much as $1.00 an hour. Throughout the decades of the 1960s and 1970s and into 1983, the average hourly earnings were higher in the meat packing industry than in U.S. manufacturing. Subsequently, the average hourly earnings have plunged behind those paid in U.S. manufacturing especially in the 1990s and continuing through the present. The chart on the next page shows the average hourly earnings comparison between meat packing and U.S. manufacturing as researched and documented by the U.S. Department of Labor, Bureau of Labor Statistics.
AVERAGE HOURLY EARNINGS COMPARISON
YEAR

 

MEAT PACKING SLAUGHTER

 

MEAT PACKING PROCESSING

 

U.S. MANUFACTURING

 

1960

 

$2.60

 

$2.40

 

$2.26

 

1961

 

2.69

 

2.46

 

2.32

 

1962

 

2.77

 

2.55

 

2.39

 

1963

 

2.83

 

2.64

 

2.45

 

1964

 

2.91

 

2.72

 

2.53

 

1965

 

2.99

 

2.78

 

2.61

 

1966

 

3.09

 

2.89

 

2.71

 

1967

 

3.24

 

3.04

 

2.82

 

1968

 

3.45

 

3.24

 

3.01

 

1969

 

3.67

 

3.46

 

3.19

 

1970

 

3.98

 

3.64

 

3.35

 

1971

 

4.20

 

3.86

 

3.57

 

1972

 

4.46

 

4.12

 

3.82

 

1973

 

4.76

 

4.43

 

4.09

 

1974

 

5.20

 

4.81

 

4.42

 

1975

 

5.67

 

5.36

 

4.83

 

1976

 

6.06

 

5.87

 

5.22

 

1977

 

6.57

 

6.28

 

5.68

 

1978

 

7.09

 

6.73

 

6.17

 

1979

 

7.73

 

7.40

 

6.70

 

1980

 

8.49

 

8.06

 

7.27

 

1981

 

8.97

 

8.73

 

7.99

 

1982

 

9.00

 

9.08

 

8.49

 

1983

 

8.58

 

8.83

 

8.83

 

1984

 

8.17

 

8.89

 

9.19

 

1985

 

8.10

 

8.74

 

9.54

 

1986

 

8.24

 

8.76

 

9.73

 

1987

 

8.41

 

8.85

 

9.91

 

1988

 

8.48

 

9.04

 

10.19

 

1989

 

8.64

 

9.22

 

10.48

 

1990

 

8.74

 

9.37

 

10.83

 

1991

 

8.92

 

9.43

 

11.18

 

1992

 

9.16

 

9.62

 

11.46

 

1993

 

9.26

 

9.89

 

11.74

 

1994

 

9.44

 

10.06

 

12.07

 

1995

 

9.61

 

10.41

 

12.37

 

1996

 

9.82

 

10.47

 

12.77

 

1997

 

10.03

 

10.74

 

13.17

 

1998

 

10.34

 

11.03

 

13.49

 

1999

 

10.81

 

11.17

 

13.91

 

2000

 

10.94

 

11.80

 

14.38

 

2001

 

11.38

 

12.27

 

14.84

 

2002

 

11.62

 

12.53

 

15.30

 

2003

 

11.59

 

12.71

 

15.58

 

2004

 

11.53

 

12.95

 

16.14

 

2005

 

11.47

 

12.86

 

16.56

 

2006

 

11.49

 

12.52

 

16.81

 

2007

 

11.81

 

12.94

 

17.26

 

Average Hourly Earning by Selected Years

Date