Understanding the long-term demography In the U.S. labor force, we have a 15-to-20-year shift in population that is going to create significant labor shortages. We are experiencing part of this right now. We're only halfway through the bubble, with 50% of the large baby boomer generation retired. There are not enough people of working age to replace them. The next generation is in school, but they're too young to work. Unlike some other countries, the U.S. will be OK long term, but we're going to have a 15 to 20-year void in our labor supply.
AI is a solution that can be employed to eliminate some of the labor voids that we will experience over the next 15 to 20 years. AI, however, requires a long-term commitment and investment to compensate for this issue. For the U.S., our neighbors to the south are key components of balancing our labor supply as well. We need our government to grasp the reality and make some hard decisions that won't be popular with blue-collar workers.
Farmers will be in short supply, in the next 15 years 70% of the farmland in the U.S. will change hands. We need young farmers to take over the responsibility. Someone must raise the corn and soybeans that we use in our feed ingredients. Ronnie Moser from United Animal Health reminded me that those of us in animal production business, have been working for 50 years to improve feed formulations, adding enzymes, and probiotics, improving feed conversion, and reducing costs.
Establishing good animal welfare policies, enforcing your policy and offering these to our customers to include in their policies is a great way to control the narrative versus being dictated to by special interest groups. It’s economically desirable, a logical best practice, and it’s the right thing to do.
Avian influenza is a serious problem, and the recent outbreak seems to be a lot different than the event in 2015. It seems to be a lot more virulent and contagious, and it travels differently. Rodent control is a critical part of solving this problem, it's also a critical part of controlling Salmonella and many other pathogens. The hot topic in America is the price of eggs. It’s simple supply and demand: By the end of December 2022, more than 43 million egg-laying hens were lost to HPAI. It's going to have a significant impact on supply and demand for months to come.
In August 2022, USDA announced its intention to declare Salmonella an adulterant in breaded and stuffed raw chicken products. Historically, Salmonella has not been considered an adulterant in raw poultry products because proper cooking destroys the pathogen. The planned policy change reflects a significant change in how USDA FSIS regulates pathogens in raw poultry. How this change would be implemented remains to be seen. Should USDA declare Salmonella as an adulterant it would have significant operational and financial implications for poultry producers and handlers.
In late February, National Chicken Council President Mike Brown delivered testimony at the House Agriculture Committee hearing, “Uncertainty, Inflation, Regulations: Challenges for American Agriculture,” which focused on regulatory barriers and red tape holding back American agricultural production.
In his testimony to the House AG Committee, Brown highlighted Packers and Stockyards Act rulemaking, processing line speeds, and new Salmonella regulations as being burdensome for poultry producers.
“All of these regulatory programs share two things in common: One, there is no compelling justification for them, and two, they would drive unprecedented levels of food inflation and food scarcity,” Brown said.
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