The squealing piglets were born in late January at the Quinn Sow Farm, inside a row of white and silver barns at the end of a dirt and gravel lane about an hour southeast of Raleigh. The barns stand in an open field near the town of Faison in Duplin County, No. 2 in the nation for hogs.
Nearly eight months later, on a rainy night in September, a salesman walked into a restaurant and ordered a dish of sliced pork with steamed vegetables. Because he’s a regular, he knew the pork would be “sweet” and “delicious.”
His name was Yoshihiro Sugawara. The restaurant was part of a chain called Ootoya. The city? Tokyo.
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Sugawara did not know all it took to deliver the thin slices of tender pork from a farm on this side of the planet all the way to his hashi – his chopsticks. It’s quite a story.
It starts with two brothers, Bob and Ted Ivey of Wayne County, whose breeding and feeding have built a special pig, one with premium cuts that have a bit more fat, a deeper color and a sweetness even machines can measure.
The Iveys are part of a weekly race against time and circumstance to deliver the pork fresh – never frozen – from barns east of Raleigh to the world’s largest metropolis. It has become an unyielding effort to penetrate the demanding Japanese marketplace, where pork is consumed with a passion akin to North Carolinians and their barbecue.
It’s not easy or simple. In the past year, the Iveys confronted a frightening virus that killed thousands of their piglets and is expected to reappear this winter. They and their partners now are watching Pacific trade talks and economic jitters in Japan.
This pork-to-Japan pipeline is a prime example of how the global marketplace shapes North Carolina far beyond the potent Research Triangle Park. Today’s worldwide economy reaches places as basic and seemingly homebound as a hog barn in Eastern North Carolina.
When Sugawara finished his meal after a day’s work in a Tokyo business district called Kanda, he set down his black chopsticks and wiped his chin. He had eaten less than an ounce of North Carolina pork.
Sugawara settled the bill, paying 865 yen, about $8 at the time, before heading off into the evening, his stomach full and happy.
His money would add to what the latest data show is a powerful part of North Carolina’s economy: shipping meat – especially pork, especially to Japan.
For years, the state’s top agricultural exports were cigarettes and tobacco, the cash crop with a global reach that built North Carolina. Its dominance as an export has faltered in the face of competition from cheaper leaf around the world and anti-smoking campaigns.
Exports of meat – much of it pork – have become a significant segment of the state’s diversifying agriculture business. It’s a crucial piece of the economy in struggling rural areas east of Raleigh.
Japan, a leading destination for the state’s products, illustrates this shift clearly. Late last year, in an unnoticed milestone in a decadelong trend, pork from North Carolina jumped ahead of tobacco as the state’s top direct export to Japan.
The growth has been staggering. At the turn of this century, the value of pork shipped from North Carolina to Japan was below $30 million a year in today’s dollars. It now tops $250 million.
North Carolinians no longer manufacture as many tables, towels or blue jeans as they once did. But the world buys the state’s food, which generates jobs and income. That has helped cement agriculture as a leading state industry that accounts for almost one of every five paychecks.
Plenty of the hog industry’s focus has been on last year’s nearly $5 billion purchase of Smithfield Foods by a Chinese group. It raised concerns about sending U.S. food technology abroad and, to a lesser degree, that Americans would eat possibly unsafe meat from a foreign land. Actually, the Chinese want American pork, too, and they are poised to ship in more from North Carolina this year than ever, according to data through August.
But it is the Japanese, with middle- and upper-class incomes and steady appetites for protein, who command much more attention, particularly in what the industry calls “chilled” pork – the never-frozen muscle cuts such as butts and loins that come from high on the hog. That’s where the big money is.
Japan will buy about $2 billion in U.S. pork this year, making it far and away the No. 1 export market for American hog farmers.
“Japanese consumers are very finicky, very rich, and they demand quality,” said Dermot J. Hayes, an expert on the pork economy and a professor at Iowa State University. “So the people who export to Japan, they export a very high-value product. And that returns a lot of money.”
‘Mutt and Jeff’
Bob and Ted Ivey are modern-day farmers, which means they mostly wear golf shirts and khakis and spend a lot of time looking at spreadsheets. They’re in conference rooms more than pig pens.
The Ivey brothers run a pork operation, Maxwell Foods, that will produce more than 500 million pounds of meat this year. Ask what positions they hold in the company, and they look at each other blankly.
Ted: “Call us Mutt and Jeff.”
Bob: “We don’t really do titles.”
Finally, they relent.
Bob: “Just call us general managers.”
More often, they act like scientists.
They easily discuss the intricacies of DNA and vaccines. They speak with reverence about their on-site laboratory, which employs molecular geneticists and two veterinarians. They like to talk about calibrating feed for hogs as weather patterns change.
They were always this way.
The Iveys grew up in Wayne County, in a community outside of Goldsboro called Elroy, where they helped their parents produce tobacco, eggs, corn, wheat and soybeans. The area today is marked by barbecue and fighter jets; it’s close to where U.S. 70 rolls past the Wilber’s and McCall’s restaurants near the runway at Seymour Johnson Air Force Base.
Ted, who turns 65 this week, went to N.C. State in the early 1970s and left with degrees in poultry science and economics. He was about to take a corporate job with a seed company when he changed his mind.
“My father had a long talk with me one day under the tobacco barn shelter,” he said. “And, well, I guess I’d say he talked me into coming back to the farm. And then Bob did the same thing. I don’t know exactly how it came down with him and my father, but I guess it was a given at that point that Bob would come home, too.”
Bob listens and nods and doesn’t add much more. “Yep,” he said. “That’s what happened.”
Bob, 60, had studied chemistry at UNC-Chapel Hill and considered working in the up-and-coming RTP before he also went home.
It was the mid-1970s, and interest rates were high everywhere except for small-business and farm deals backed by the government.
The Ivey brothers ended up with a pair of low-interest loans and a shared idea to diversify the family farm with swine. “Didn’t want to just come back and do what my father had done,” Ted Ivey said.
They decided on something else: Whatever they were going to do, they would do it together. Even today, they live four minutes apart along the shores of a small lake near Goldsboro.
New ways to analyze
In 1976, the Iveys formed a genetics company and began obsessing over the details of hog breeding. They quickly rejected a long tradition of judging hogs by how well they showed on the fair circuit.
Instead, they connected with a specialist at N.C. State and used early versions of personal computers to make the decisions. They wanted to measure and rank hogs by where it mattered most: the marketplace.
“Back then, there were many, many farms, and all the genetics was at the State Fair,” Bob Ivey said. “The judge would say, well, this pig is better than that pig and so forth and so on, which didn’t make a lot of sense.”
“Not very science based,” Ted Ivey said.
They wrote software to chart precise traits. How fast did a hog’s back fat grow? How many piglets were born alive to a sow? How much did the babies weigh after 21 days?
They prized a calm sow that resisted disease and produced a strong litter with quality meat. These are common measures now across the industry, and the foundation for millions of dollars in sales.
Meanwhile, pork was becoming a big business in North Carolina.
In the 1990s, hog farming mushroomed into an industrial-scale production, with hogs growing indoors at a relatively low cost. The concentration of animals raised widespread concerns about harm to the environment, forcing a moratorium in North Carolina on large new farms in the late ’90s.
By then, nearly 9 million hogs were in place – along with packing plants necessary to slaughter them. The state became No. 2 in the country in hog production, behind Iowa.
Japan was a natural target market. Unlike developing nations, fresh pork was already a regular part of meals there. One of the most popular is tonkatsu, a cut of boneless loin that’s breaded, fried and drizzled with a special sauce.
“Just like tuna sells for tremendous prices in Japan, pork has a special place in their diet and culture,” said Kelly Zering, a professor of agricultural and resource economics at N.C. State University who has studied the pork economy. “This whole idea of food as not just sustenance but as cultural treasure and custom is part of that market.”
Japan has well-known regional pork companies, too, each producing meats with their own followings.
But a dwindling base of Japanese farmers can’t meet the demand, so Japan has had to rely on the rest of the world. Almost half its pork is now imported.
Raoul Baxter, a former top executive at Smithfield Foods in Virginia, began working on finding overseas business in the early 1990s. Baxter connected with the Sumitomo Corp., a huge trading company based in Tokyo, that was also looking abroad for pork.
Sumitomo’s challenge was finding a product that discerning housewives would accept at a higher price. At the time, U.S. imports were seen as low quality and cheap.
Baxter, now a semi-retired food consultant, said breaking into Japan required a new approach.
“They are very conscious and very objective about what flavor is and what taste is,” he said. “They get very, very scientific. And so we had to really focus in on pork and pigs that had the best chance of providing the quality of meat the Japanese wanted.”
In a period of experimentation, Smithfield began sending small batches from its packing plants to Japan. The Japanese rejected much of what they received.
Over time, Baxter noticed one type of pork was, in the words of Sumitomo, “qualified.”
He began to investigate. It led him to Bob and Ted Ivey.
Birth of Silky Pork
As hog farming boomed, the Maxwell family of Goldsboro looked to the Iveys to set up a hog operation within the umbrella of the family’s interests, which include extensive poultry operations and a feed company.
The swine arm became Maxwell Foods, and the Iveys grew it from scratch in 1989 into the 11th-largest pork producer in the country this year. It now employs more than 600 people and has a network of about 175 farms in Eastern North Carolina.
Jim Maxwell, who led the family into hog operations, said the Iveys’ deep knowledge about hogs set them apart.
“They had the reputation as being good producers, with good genetics, and they’re Wayne County people that we knew,” he said. “They had the reputation of being very progressive producers, which was something we were very interested in. You look at those pieces, and they all came together.”
In 2007, the Iveys invited Temple Grandin, an influential expert on animal safety, to visit their farms.
Grandin, an animal sciences professor at Colorado State University, said the Iveys worked differently.
“The handling of pigs in this industry was just awful,” Grandin said. “A lot has changed – it’s different now than 20 years ago. They were out front.”
They had always practiced “pen gestation,” or group housing, meaning their pregnant animals weren’t kept in cramped crates. Workers, not machines, feed those animals. Other companies now have pledged to do the same.
The Iveys said it was good business, too – their data showed the animals performed better in better conditions.
All along, the Iveys and Maxwells began calibrating their pork for Japan’s tastes to fill Sumitomo’s orders, resisting a trend in the U.S. to grow leaner hogs.
They worked to produce more flavor. They worked for more sweetness, color and juicy fat in the right places.
The Ivey pigs began to produce more marbling, like in a steak.
“White streaks of lightning,” Ted Ivey calls it.
In October, he watched a group of his hogs processed at the packing plant. He put his face down close to the end of a loin, which was marbled and dark pink.
“Man, look at that,” he said. “Just what we want.”
It’s what Japan wants, too. Today, it’s called Silky Pork.
Breeding and feeding
Silky Pork starts near LaGrange in a small white barn filled with boars that weigh more than 500 pounds.
Most pork in America – and Japan – comes from crossing no more than three traditional breeds. They have names such as Duroc and Landrace and Large White, with well-documented characteristics, like Labrador retrievers and poodles in the dog world. The Iveys add a fourth breed to their mix, a less common one called Chester White.
Day after day, week after week, workers collect boar semen from the four types of hogs, dyeing it red, blue, green or yellow to keep it organized. Then, it is used to inseminate females in a careful program of breeding.
Making Silky Pork is like building a family tree again and again, with great-grandparents and grandparents and parents crossed until it produces the one they want.
The formula also means constant adjustments in the feed and a “special feeding program” for pigs bound for Japan. Ask the Iveys for details about the rations and they grin and dodge, acknowledging how important it is.
“It’s proprietary,” Bob Ivey said.
Roughly 300 of their boars will produce about 1.3 million market hogs this year in North Carolina. Of those, the cuts from about 200,000 will make it to Japan as Silky Pork.
The other hogs in their process end up mostly in the U.S., raised without the special formula of feed and distributed like any other as hams, ribs, bacon and sausage.
A sweeter taste
In today’s U.S. pork business, most consumers have little idea where the meat comes from. The brand on the package is most often the grocery that sells it or the company that packed it.
In Japan, it’s different. Groceries and restaurants emphasize where the pork is from. Japanese customers associate pork with regions of the country and their farms.
As 2011 began, with the feeding program in place, Sumitomo worked to create a new category of “branded” U.S. pork. The company chose the name Silky Pork for labeling and marketing what the Iveys were perfecting. It would compete against roughly 400 such brands in Japan in a market niche between more expensive Japanese-grown pork and other less expensive U.S. imports.
Kenjiro Fuji is general manager of the meat materials department at SC Foods, a subsidiary of Sumitomo. He said being able to trace the meat through the packing plant and back to the barns and the people who work in them gave the company a story to tell, and sell.
“It’s a big advantage for us,” Fuji said. “We have to sell at a higher price, so we created a reason to sell at a higher price. We can trace which farmer made this pork.”
The Iveys had built the pig. Sumitomo was taking it to the market. In the middle was Smithfield Foods, cutting it to strict specifications.
Smithfield runs specialized lines at its packing plants to cut the hogs just how the Japanese want. Smithfield makes a pork belly with the rib meat still attached, for example, and a smaller cut from the Boston butt that isn’t available in the U.S.
At a Smithfield plant in Clinton, the Silky Pork is always processed first, when the plant is the cleanest. At Tar Heel, home to the country’s largest packing plant, there’s a separate area for Japan.
Sumitomo pays more for the Silky Pork hogs, about 20 percent more per head. But Sumitomo also sells the product at a premium.
Stores and restaurants in Tokyo highlight how the breeds are mixed together to make the meat. Yongenton, these menus and displays say. Four breeds of pork.
Some Japanese grocers have posted a picture of Bob and Ted Ivey, wrinkled, tanned and smiling on a farm near Goldsboro.
In early 2011, SC Foods commissioned a taste test, using a machine to measure sweet, sour, bitter, salty and savory tastes.
Silky Pork matched up with Japan’s well-known and highly regarded homegrown “black pig” breeds. It easily beat out four other types of pork from around the world, including U.S. competitors. It was No. 1 in sweetness.
And the pork is selling, up 40 percent in the past four years. Sales in Japan are expected to grow at up to 20 percent annually, even in a tough economic climate, said Taiki Teramoto, who handles the chilled pork business for SC Foods.
Japan is a long way from a metal office building along U.S. 70 near LaGrange where the Ivey brothers spend a lot of their days, studying reports, chatting with farm managers and plotting improvements. They call it the Hog Annex.
The annex is usually surrounded by white pickup trucks. It’s a daily hub where workers flow in and out, trading information on what’s going well – and what isn’t.
In early 2014, it became a command center in a sudden fight against a surprising killer disease.
Tomorrow: ‘Something I’d never seen.’