Smithfield Foods strikes pig deal with Murphy Family Ventures

USA – Smithfield Foods, recognized as the largest pork processor globally, is in the process of selling 150,000 female pigs to Murphy Family Ventures, according to a report by Reuters. 

This transaction is part of Smithfield’s strategy to decrease its hog ownership ahead of a potential listing in the United States.

Upon completion of the deal, Murphy Family Ventures will emerge as one of the most important independent pork producers in the country, with an estimated capacity to raise approximately 3.2 million hogs annually for Smithfield’s fresh pork operations. 

The agreement entails that Murphy will take ownership of the sows and the market hogs they produce, while Smithfield will continue to provide essential services such as production management, feed supply, and transportation.

Shane Smith, President and CEO of Smithfield, commented on the company’s transformation over the past decade into a more focused consumer packaged goods entity. 

He emphasized that this agreement aligns with their ongoing evolution while ensuring a consistent supply of hogs sourced from family farming operations.

The transaction is slated for completion by the end of this year. 

This move comes as Smithfield’s parent company, WH Group based in Hong Kong, seeks shareholder approval for the proposed spin-off of Smithfield and aims to list the business on a U.S. stock exchange.

In recent years, Smithfield has faced challenges in the pork market due to declining pig prices and consumer demand amid rising costs for labor and materials. 

As a result, the company has reduced its hog production and scaled back operations across several states, including Missouri and Utah. 

Last year alone, it announced plans to terminate contracts with 26 farms in Utah and close 35 farm sites in Missouri.

Additionally, Smithfield has begun separating its European operations from its North American business as part of its strategic realignment. 

The firm has been adjusting its operational footprint in response to market conditions while continuing to explore avenues for growth.

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