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Many producers are talking about and considering whether they should make the necessary alterations to their production facilities to ensure compliance with California’s coming restrictions on the sale of pork meat, otherwise known as Proposition 12. Proposition 12 is not just about pork but has similar production system minimum requirements for egg-laying hens, veal production and pork. For pork, sows would be required to have a minimum of 24 square feet of space. Less than 1% of US production complies at the present time and Rabobank estimates that sow barn costs would rise between 170 and 210 percent.
Due to sweeping political changes around the globe, we already see wide-ranging changes coming to agriculture in general and to pork production specifically. While this one in California is already in the courts, it seems likely that the political process will step deeper into animal (and crop) production systems with more control measures. The result will be the further reduction in small farms and the concentration of what remains of production in very large systems, due to the compliance costs. Expect production to migrate to countries which are already well suited for production but a little less likely to saddle themselves with higher regulatory costs.
The key policy areas which undergird these changes are related to the environment, (climate change specifically) and animal welfare minimums. Most of these topics have been under investigation for quite a while, so do not expect it to take much time for full-blown legislative prescriptions to hit state and national legislative bodies and other regulatory entities such as health departments. They have been waiting for the right politically favorable moment and it has arrived.
The most ardent proponents of action on climate change now publicly admit that even if the United States and China were to reduce climate related emissions to zero, it would not be enough to halt the rise in temperature which has already been “baked in” (pardon the pun) (more on this topic in a future article). There does not seem to be a way to raise the alarm any farther than, “it's already impossible to fix!”, as means to cause a clamor of support, so it will be interesting to see what the next compelling reason to enact restrictions on greenhouse gases will be. There are a couple of trends which may become linked and thereby move the world toward significantly less meat production and consumption in support of these initiatives.
The first of these is really a philosophical argument couched in climate science. Here is the argument: If modern agriculture is left to its own devices, it can feed far more people than the “carrying capacity” of the earth environmentally. It appears that Malthus (circa 1798), who predicted a few hundred years ago that famine, war, and disease would reduce global population to carrying capacity, since technology of agricultural production could not keep up with population advance has lost the debate. We witnessed the end of that argument when the first tractor rolled off the assembly line with a moldboard plow attached. So now, modern agriculture must be hobbled through policy changes to the point that we reach a capacity to feed far fewer people and thereby begin reducing population. Current arguments before USDA are attempting to convince policymakers to limit production of pigs on a given quantity of land, for instance, to the amount that could be produced with the technology of a family farmer of the 1960s.
The second trend which will enable a more rapid de-escalation of growth in meat production globally is the massive investment being made in meat substitutes by major meat industry firms. Sorry, folks, we like the taste of most of them, but we would never recommend that pork and beef be systematically replaced with these products. Let us just have them for an additional choice at the supermarket. Most likely, they will serve an important enabling function if current trends continue. Careful policy prescriptions will solve the problem of disruption, which rapid moves to dramatically reduce meat production and consumption would cause. It will be a process of substitution spurred on by escalating cost advantages in favor of plant-based protein and a re-educated (and shamed) consumer. We will have plenty of substitute supply and an increasingly re-shaped demand.
If you want to keep tabs on an unrelated industry that is facing some of the same pressures as meat production and watch how fast things can change, keep an eye on the automobile and truck sector. Cadillac just announced a probable all electric model portfolio by 2030. Several other car companies are doing the same because policy prescriptions regarding efficiency standards cannot produce a car that most people want to buy because half of the population could not get into it. The all-electric Range Rover hearse that bore the body of Prince Phillip to its final rest demonstrates that size and scale are quite possible with all-electric vehicles, but they are not available with current and coming fuel efficiency standards for gas-powered consumer vehicles. There are some natural roadblocks to most of these coming changes which have not been considered yet that may not make much difference. We’ll be watching.
