Seaboard’s Positioning on Supply Chain Control

The pork sector is facing uncertainty. Disease pressure, particularly PRRS, is elevating risk, while corn and soybean meal costs remain unstable. Margins for producers have been thin, with the industry losing an estimated $57 per head as recently as 2023.

Owning more hogs outright gives Seaboard predictability. It avoids relying on spot market purchases that could be constrained by herd liquidations or price spikes. It also captures more of the margin by internalizing production rather than paying suppliers.

The Southern Plains are gaining share of the U.S. hog herd. Texas inventories rose 13 percent year-over-year to 1.17 million head as of March 2025, while Oklahoma sits at 2.09 million. Producers are increasingly locating operations in Kansas, Oklahoma, and Texas to escape disease-prone regions of the Upper Midwest and to operate under less restrictive environmental frameworks.

Seaboard’s expansion fits this broader geographic transition. The Southern Plains provide proximity to Guymon, access to rail for exports, and the space to build large-scale finishing operations.

This is not Seaboard’s first move to buy security. The company spent more than $250 million in 2016–17 to secure hog inventories for its Iowa joint venture with Triumph Foods. It bought Hitch Pork Producers in 2020 for $27 million and paid $58 million in 2022 for assets from The Maschhoffs. As of early 2024 Seaboard controlled about 336,000 breeding sows, making it the third-largest U.S. hog producer.

Each acquisition has been justified with the same rationale: reduce reliance on third-party hog suppliers and smooth supply chain volatility. That logic holds even more weight today given disease outbreaks and elevated feed costs.

The U.S. pork industry is structurally integrated. The top 36 producers control about 70 percent of the nation’s sow base. Roughly 70 percent of hogs are raised under production contracts where packers own the pigs and inputs while growers provide barns and labor. The latest Seaboard move is another step in this trend toward fewer, larger players controlling more of the supply chain.

For independents, the consolidation further narrows marketing options. For packers, it creates stability. For Seaboard, it ensures that its Guymon lines keep running even in an environment where volatility is the norm.