Tyson bans drug

Firm foresees greater pork exports with move.

Tyson Foods Inc. said Thursday that it will prohibit the use of growth drug ractopamine in its hog herds next year to cater to a growing demand from China and other export markets that ban the hormone’s use.

Chinese demand for U.S. pork is climbing as a swine disease continues to decimate the nation’s herds. Tyson and others are changing their strategies to bring more supply to foreign markets.

Earlier this month, competitor JBS USA said it will start phasing out ractopamine from its hog herds. On Thursday, Tyson followed suit.

In a statement, Steve Stouffer, Tyson Fresh Meats president, said he believes the move will open up more export opportunities, allowing “farmers who supply us to compete more effectively.”

Over the past year African Swine Fever, a disease deadly to pigs but not to humans, has plagued Asian countries, wiping out millions of hogs. In China, the largest pork producing and consuming country, the disease is on track to cut its hog herds by 40% from pre-outbreak levels by the end of 2020, the U.S. Department of Agriculture reported last week. As a result of this, Chinese imports of pork are expected to balloon and surpass agency estimates through next year.

Meanwhile, billions of dollars worth of U.S. products sent to China are subject to retaliatory tariffs. After a year of back-and-forth, President Donald Trump announced a “phase one” trade agreement with China last week, estimating that annual agriculture purchases will skyrocket to $40 to $50 billion, from the current average of $8 billion. Trump also delayed a tariff increase that was supposed to take effect earlier this week.

Despite the trade war, the amount of U.S. pork sent to China spiked over the summer and in August, totaled 125 million pounds, a new monthly record, according to USDA data. China went a step further last month and exempted certain agricultural products, such as soybeans and pork, from higher tariffs.

Limited amounts of pork, free of ractopamine, are processed by pork packers for China and other foreign customers, but Tyson said “these programs no longer adequately meet growing global demand.”

Tyson Fresh Meats, the parent’s pork and beef subsidiary, generates almost $1 billion in pork export sales annually. The company said

it wants to prohibit ractopamine use in hogs by February. Over the next several months, Tyson plans to work with farmers and begin testing their hogs for the growth hormone. Some 2,000 farmers were notified of the change on Wednesday.

Ractopamine, commonly used in swine feed to grow leaner meat faster, has been a long-time sticking point for the industry. According to Food and Water Watch, a D.C.-based watchdog group, although use of it is allowed in 27 countries, including the U.S., Canada and Mexico, 160 countries, including China and European Union members, do not.

While the hormone is approved by the Food and Drug Administration and considered safe for use, ractopamine critics have raised concerns of it stalling trade to key export markets and hurting animals. A 2012 investigation found that more than 200,000 pigs had adverse effects to ractopamine since the drug’s approval, according to a review of FDA records by the Food and Environment Reporting Network. Pigs suffered from “hyperactivity, trembling, broken limbs, inability to walk and death.”

Farmers have been bracing for the change for years, said Glynn Tonsor, an agricultural economics professor at Kansas State University. Larger producers have added limited amounts of ractopamine-free hogs to their supply, selling them as “more premium” products, he said.

“The topic itself isn’t new,” Tonsor said. What this move from the largest pork packers means is they can gain more market share with more pork products. Shoppers are more likely to find ractopamine-free pork cuts at grocery stores, but those same hogs produce a lot of sausage, he said.

“I would suggest it’s harder to find a premium on those products,” Tonsor said. “Try to find a package of sausage and find a no-antibiotics claim on it. It’s much harder than on a pork chop.”