With the purchase of the Hormel Foods pork processing plant in Fremont, South Dakota-based WholeStone Farms LLC has found a place for its members to sell their hogs.
The relatively new company, started in 2017, is a consortium of over 220 pork producers from South Dakota and Minnesota who collectively farm about 400,000 acres raising about 12 million pigs a year, according to Luke Minion, chairman of the board of WholeStone Farms, and the interim CEO.
“We’re a new organization, but the owners are family farmers across the midwest,” he said. “So really as WholeStone goes, we’re new, but really we’re comprised of people that have worked together closely in a variety of ways in the last 25 years in terms of raising pigs and farming.”
According to Glenn Muller, executive director of South Dakota Pork Producers Council, since WholeStone has come on the scene in South Dakota the organization has been looking into different avenues of entering the processing side of the pork industry.
“They are relatively new and over the course of the last year they have been doing a lot of fundraising and looking at constructing or purchasing a processing facility,” Glenn Muller, executive director of South Dakota Pork Producers Council, said. “It’s a company that is producer driven, made up of investors who are involved in production and they are looking to expand their involvement in the overall supply chain.”
Minion says the purchase of the Fremont plant will allow WholeStone to do just that.
“Our goal is to capture more value in the chain, and so as farmers right now, we obviously capture it as we sell the hog and we’d like to move up one level and sell meat,” he said. “This allows us to do that.”
Minion added that with the purchase of the plant will help WholeStone continue to grow its business as well as potentially add more production at the plant.
“As far as Fremont, we intend to grow here over time, we want to add a second shift and try to add really what would be capacity to the ability to harvest hogs here,” he said. “The Fremont plant was very strategic. It fit our goals well, and allows us to harvest some of our hogs, and on a double shift, more of our hogs, and we still won’t have all of them done after that.”
WholeStone’s model of bringing together independent producers and consolidating functions to create cost-effectiveness is similar to the company’s affiliate, Pipestone System, which is based out of Minnesota.
“Pipestone’s really part of a founding group of members that created WholeStone,” Minion, who has also been the CEO of Pipestone for 14 years, said.
Minion says that Pipestone is the fourth largest pig producer in the United States and involves more than 500 family farmers from across the midwest.
Pipestone System is also a consortium of producers that, as a organization, sells shares to independent hog producers and each producer receives an allotment of pigs based on shares owned and a preferred schedule, according to information on the company’s website.
Pipestone also consolidates functions like animal health products, feed, veterinary services and employee benefit packages to create cost-effectiveness for its consortium of invested producers.
Minion says that many WholeStone producers are also affiliated with Pipestone.
“The distinction is this—there’s many people, farmers now that are in both. They have an affiliation with Pipestone through years in raising pigs and being part of that. But they’re not all the same people,” he said. “So in other words, most of the members of WholeStone will also be Pipestone System, but not all.”
Muller added that consortiums like Pipestone and WholeStone are becoming more common in the industry as independent producers look to remain profitable and meet consumer demand.
“It’s not uncommon as producers look to remain profitable,” he said. “There’s also been more emphasis from the consumer base wanting to know exactly where their pork is coming from. These types of consortiums allow better flow from producer to the meat case.”