Some 100,000 hog farmers were eligible to vote in the referendum. To qualify, a farmer had to sell at least one hog in the last year. The Campaign for Family Farms submitted petitions with the signatures of more than 19,000 hog farmers to the Agricultural Marketing Service of the USDA calling for a vote on the mandatory checkoff.

The pork checkoff system became mandatory in 1986 after Congress passed The Pork Promotion, Research, and Consumer Information Act of 1985. Hog producers must pay 45 cents for each $100 in sales of hogs. The funds raised, which by now amount to more than $506 million, pay for research, lobbying, and marketing such as the "Other White Meat" advertising campaign of the National Pork Producers Council (NPPC).

"This is a straight tax on hogs sold," Joens said in an interview. "The National Pork Producers Council has not developed anything except running the independent producer out of business."

Joens said the research and marketing campaigns are geared to the big corporate farms and packinghouses and have done nothing but add a burden on the family farmer. He said the 15-member council includes representatives from the big packers such as IBP and Smithfield. Joens said he believes the research has been geared to flooding the hog market, which has contributed to driving prices down and forcing more small farmers out of business or into contract farming for the big packinghouses and grain monopolies.

Hog farmer Larry Ginter from Rhodes, Iowa, said in an interview, "The NPPC took in $500 million since 1986 from the checkoff and we lost 250,000 producers. I can name eight of my neighbors in a one-mile radius of me who stopped raising any hogs just in the last three to four years."

In 1998 hog prices dropped to record lows, bottoming out at 8 cents a pound in December of that year. The average price in the fall of 1998 was 28 cents a pound. Most farmers figure they need at least 40 cents a pound to break even on raising a hog.  
 
Family farmers hit hardest
Ginter estimated that he lost an average of $20 per hundredweight for his pigs in 1998 from the previous year. "The hog factories, which contract with the packers, caused a huge glut on the market," he said. "The packer and the retailer made out big while the family farmer lost everything.

Joens noted, "On Dec. 20, 1998, there was the 8-cent hog. You could do better taking them to the rendering plant, where you could get 14 cents a pound."

Describing the effect of the plunge in hog prices on his community, he added, "Last year in Nobles County there were 140 independent producers--now there are less than 70. Some have been forced to go into specialty feeding, taking contracts out with the big grain companies and packinghouses."

Over the last decade, more farmers have taken direct contracts out with grain companies and packinghouses. About 50 percent of the hogs produced today are raised under contract, that is, the farmer delivers hogs for an agreed-on price exclusively to one packing company.

Farmers who have direct contracts with a packinghouse are guaranteed a set price on delivery. But there is a catch. The open market price will differ from the contract price, either higher or lower. The contract has an accounting mechanism and the packer keeps a ledger. When the open market price drops below the contract price, then the farmer runs up a debt to the packinghouse. In theory this should all even out when the price goes back up. But in 1998, "hog farmers came out owing the packers money on the ledgers," Joens said.

Another 25 percent of the hogs are raised by businesses that are also owners or part-owners of packing plants. These factory farms are owned by agribusiness barons such as IBP, Cargill, ConAgra, and Farmland Foods. Smithfield, the largest pork producer in the United States, directly owns 50 percent of its hogs, said Joens. These giants control 50 percent of the national pork market and 80 percent of the beef market.

Joens explained that the farmer receives the hogs and grain from the company and the upkeep is done by "specialty feeders." He said, "The company takes out a seven-year contract and the farmer has to guarantee delivery of the hogs to the packer on a given date. The farmer is reduced to feeding the hogs. The barns go up on their land and what they are left with after the contract is the pollution, the manure, and the disease." It takes one person to maintain every two barns. "What the companies want is the most efficient pigs and they will skimp on the costs of raising the animal," he remarked.

The Noble County farmer reported that there was an aggressive campaign run by the feed companies and packinghouses to maintain the pork checkoff system. He received daily mailings and phone calls lobbying for a "yes" vote.

"The vote 'no' campaign is a statement to the big grain companies and packinghouses that the NPPC has developed nothing but a system to run the family farmer out of business," he said.

The results of the referendum are not expected to be released until December.