Modern Hog Production and Land Values
Livestock Update, July 1998
Cindy Wood, Animal and Poultry Sciences, Virginia Tech
This information was sent out in Ron Plain's Swine Economics Report for June 12, 1998, and is interesting food for thought.
Groups and individuals opposed to modern hog production often list depressed property values as one of the many woes that beset locales that have large numbers of corporate hog farms. An interesting case study is the two Carolinas. Over the last 20 years, North Carolina's hog inventory has grown from 2.3 million head on December 1, 1977, to 2.55 million on December 1, 1987, to 9.7 million on December 1, 1997. During this same time, South Carolina has seen its hog inventory drop from 525 thousand in 1977 to 450 thousand in 1987 to only 290 thousand on December 1, 1997.
As most anyone familiar with the hog industry knows, North Carolina has become the poster child for corporate hog farming while South Carolina has nearly gotten out of the hog business entirely. In 1977, North Carolina had four times as many hogs as South Carolina. Today, for every hog in South Carolina, there are 33 in North Carolina.
What has been the impact on land prices in North Carolina of this huge growth in corporate hogs? In 1978, North Carolina farmland values (an average of $830/acre) were 27.1% higher than land values in South Carolina, which averaged $653/acre. By 1988, North Carolina land values had grown to be 45% higher than in South Carolina. USDA's January 1, 1998, numbers put the average value of North Carolina farmland at $2,130/acre, 48% higher than the $1,440 average for farmland in South Carolina.
Based on this data, it's not clear whether corporate hogs are driving up the value of North Carolina farmland, or perhaps there are just not enough hogs in North Carolina to have any significant impact on land values.