SubscribeJust ten companies have sales amounting to more than $80 billion of the slightly more than $100 billion in sales for the industry in 2004. The meat packing industry has become highly concentrated as the actual production and sales have fallen into the hands of fewer and fewer companies. The four largest beef packers increased their share of the industry's slaughter and processing output from 25 percent in 1977 to 80 percent in 2002. Over the same period of time, the four largest hog packers increased their share of the hog slaughter from 36 percent to more than 65 percent. Ranking in order of production, the four largest beef packers are: Tyson Foods (IBP is now part of), Cargill Meat (formerly Excel), Swift & Co. (spun off from ConAgra) and Smithfield Foods (Farmland and other acquired beef companies).
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Coinciding with the concentration of production into the hands of fewer operators has been the closing of competitor's plants. Since 1980, the number of slaughter plants has plunged from more than 600 to 170 cattle slaughterers. Since 1980, the number of hog slaughter plants has been reduced from more than 500 to 180. The number of processing plants has also been decreasing. Nearly most of the closed plants were small facilities. Smaller operators who do not have a special market niche simply cannot compete with the predatory practices of the big operators and the huge advantages that come with the economy of scale both in the purchase of live animals and every day plant production operations.
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posted by melissam at 4:33 PM on January 30 [1 favorite]