Swine flu And Pork Industry

Last time I wrote about the general awareness and facts about swine flu and other pandemic outbreaks. There is tons of information available on swine flu and the danger pork industry poses to spread of swine flu.  Well, there is another side to the story; swine flu poses danger to the pork industry.  Let us look at swine flu from eyes of the pork industry, which has been hit hard on top of the recession.  Last year, the U.S. was the top pork exporter, shipping nearly 25% of total volume to various countries; China and Russia were among the biggest buyers. Last year, China bought nearly $700 million in U.S. pork, ranked third behind Japan and Mexico. Russia ranked fifth with $476 million. But in response to the H1N1 flu strain that has infected people and swine, twenty countries including China and Russia have banned imports of pigs, pork and other meat this year from U.S.  

 

Rest countries with bans on U.S. pork are Ukraine, Azerbaijan, Kazakhstan, St. Lucia, Indonesia, Thailand, Bahrain, Uzbekistan, Kyrgyzstan, Jordan, Macedonia, South Korea and Malaysia. Although these nations import far less U.S. pork than China or Russia, still they can have significant impact on shrinking pork exports from US.

 

As per the American Meat Institute pork bans worldwide could cost the U.S. pork industry $710 million annually, or $13.6 million per week.

 

This plunge in the pork industry happened despite the fact that the Centers for Disease Control (CDC) and World Health Organization (WHO) have made clear that swine influenza viruses do not transmit or affect people by eating pork or pork products. People can eat pork and pork products which is properly handled and cooked.

 

What does US pork producers think about the major reason of hurting pork industry?

U.S. pork producers say that the name of the virus “swine flu” which is spread by Mexico, the major reason of affecting their business. Because ‘Swine flu’ name is a misnomer and makes people wonder about eating pork. Although many government health agencies began referring to the strain by its official name: 2009 H1N1 but pork producers say the damage is already done.

 

How much damage in pork industry has been reported till now?

As per USA TODAY report the major pork producers such as Smithfield Foods (SFD), Tyson Foods (TSN) and Bob Evans Farms (BOBE) dropped 12.4%, 8.9% and 6.4% market share respectively. Investors are also wondering if consumers might cut back on pork consumption due to confusion about how the virus spreads.

 

What are pork producers and processors doing to market the safety of their products?

Smithfield Foods, Inc. told to their investors in a statement that, “it has found no clinical signs or symptoms of the presence of swine influenza in the company’s swine herd or its employees at its joint ventures in Mexico,” and, “its joint ventures in Mexico routinely administer influenza virus vaccination to their swine herds and conduct monthly tests for the presence of swine influenza.”

 

Tyson Foods only referred to the CDC statement that the flu is not affecting pigs, and stated, “Our pork products are safe.”

 

But there is still doubt that these statements will bring any hope to consumers who are highly scared with the deadly affect of swine virus and actively trying to protect them.

 

At this critical scenario Forbes comes forward with few strategies to increase the market share of pork-producing industry.  Following is the gist of the article from Forbes;

 

• Recognize that reality doesn’t matter: David Serchuk mentioned that as the peanut salmonella scare wasn’t really about peanut butter, the H1N1 flu is not really about pork. But that won’t stop people from believing it is. The industry must accept the perception that the swine flu is a real issue for pork and go from there. 



• Embrace the “swine flu” name: Smart option is to get the CDC and the WHO to talk about the virus as H1N1 or Influenza A because the public may hear that H1N1 is no longer a threat but still connect “swine flu” with dangerous pork.


• Overspend now: Producers should invest in awareness campaigns instead of thinking about how much an awareness campaign will cost. The producers should think about how much the worst-case scenario of this crisis could cost them over the next five years. Some pork producers say that they are in a loss and don’t have the money to put behind a big campaign and others said the crisis would pass if they just waited it out.  Well look at the history and it will tell that recovery is not fast enough from such epidemic if awareness is not spread effectively.


• Focus on the meat counter: Walmart and the big supermarket chains should reinforce at the meat counter that pork is safe, otherwise the industry would face a very tough time in changing perception of peoples.



• Make it personal: People don’t trust industries when they argue that their own products are safe. Rather than industry should seek ways to get pork industry employees to get the message out.

Though the strategies are insightful but it is to be seen that whether pork producers agree upon and implement strategies conveyed by the prestigious sources such as Forbes to increase their market share.

 

I can tell you from my own Pharma marketing experience that changing perception of the common man is one of the hardest things.  Competition is good for companies and competition is the driver for delivery of quality products to consumers.  But, more than anything else, pork industries should come together and drive the message home, before it is too late.

The Swine Flu Survival Guide Click Here!