Process

Process

For 120 years, Hormel Foods has been guided by the values of integrity and innovation. The company has flourished by promoting the best governance practices with high standards for transparency and accountability, as well as financial sustainability through the use of sound business decisions. At Hormel Foods, we make a concerted effort to marry our financial and sustainable goals to ensure we bring the best possible products to our consumers through the most ethical practices.

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Environment

Hormel Foods understands and accepts the responsibility to minimize our impact on the environment and is recognized by independent sources for our efforts. In 2010, our Progressive Processing LLC (Dubuque, IA) production facility was a finalist in both the Green Manufacturing and Manufacturer of the Year categories of the Strategic Manufacturing Awards. We also invested more than $10 million in environmental upgrades and improvements in our facilities.

The production and transportation of consumer goods impacts the environment by consuming energy and water and producing air emissions and waste. Our products travel to stores and restaurants in more than 40 countries by rail, truck and ship. Once purchased, the product packaging used to protect our product is disposed of or recycled by consumers. Through this report, we will state what we are doing to mitigate these impacts. Read our environmental policy for more information about the commitment our locations have made toward environmental sustainability objectives.

We continue to report environmental data that is normalized by thousand pounds of finished goods shipped from each location. Accounting for variations in size and production at different facilities, this allows us to more accurately show our relative performance in a year-over-year comparison.

Topics in this section include:

Environmental Management System

To track and monitor our progress toward meeting environmental requirements, we use a web-based Environmental Management System throughout the company. This system includes compliance calendars, policy and procedure information and environmental training materials.

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Knowledge Sharing and Training

To achieve our environmental goals we continually improve our practices, which includes enhanced information sharing. Monthly conference calls with plant engineering and environmental staff are used to facilitate communication on environmental compliance and sustainability issues. In addition, we hold a biannual company-wide environmental conference to discuss environmental improvement projects and to encourage knowledge sharing among Hormel Foods plant engineers from around the country. Our most recent company-wide environmental conference was in fall 2010. Additionally, we require regular environmental training covering storm water, wastewater and air emission programs, as well as the proper handling and transportation of waste materials.

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Hazardous Waste

Certain operations generate low volumes of regulated hazardous waste. Most of our locations are well within the federal definition of a Conditionally Exempt Small Quantity Generator. Our facilities adhere to strict operational standards that have been designed to assure compliance with all applicable hazardous waste rules. Our operations also generate small quantities of other regulated substances, such as used oil, batteries and lamps. As with the generation of hazardous waste, strict standards are applied to assure compliance with regulatory standards.

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Compliance

Our expectation is to comply with local ordinances and state and federal laws at all times. During fiscal year 2010, we received no Notice of Violation (NOV) at the state or federal level. When issues arise, we work cooperatively with regulators to ensure resolution of all environmental matters.

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Internal Recognition

Teams are continuously working with our suppliers and managers throughout the company to raise awareness about sustainability efforts. We have set aggressive environmental goals that require employees to think of new ways to help us conserve our resources. To recognize new thinking and environmentally friendly projects, we established the Environmental Sustainability Best of the Best annual competition in 2008.

The program is designed to reward and recognize teams that have identified areas for improvement and implemented changes to make a measurable difference that will reduce the company’s environmental impact and help Hormel Foods achieve its environmental goals. In 2010, the competition included 39 entries. Read more about the winning projects.

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Responsible Animal Treatment

Producing the highest-quality, brand-name foods and meat products for consumers throughout the world starts with industry-leading animal care practices. For 120 years, Hormel Foods has focused on treating animals humanely simply because it is the right thing to do.

We base our animal husbandry practices on the best scientific data available, new technologies and hands-on experience. The combination of these factors allows us to have a consistent, successful and measurable animal care program. Throughout this section of the report, we outline our commitment and policies related to animal care for hogs and turkeys.

Topics in this section include:

Raising our Animals: Husbandry

Our commitment to ensuring all animals are raised in a healthy environment and treated properly starts with training, reinforcement and knowledge of each person’s skills, while he or she interacts with each hog and turkey. We expect training and proper animal management to be the foundation of each production facility’s culture and reinforced daily in the behavior exhibited by all employees. Our animals come from both company-owned farms and independent family farms. We hold our company management staff and the independent producers who supply animals to Hormel Foods to the highest standards. We also encourage employees at company farms and at independent family farms to hold each other accountable for proper animal care techniques.

To protect our animals from extreme weather conditions, predators and disease, the hogs and turkeys are raised in barns with climate-controlled environments. Within these facilities, 100 percent of the market hogs for Hormel Foods are housed in group pens and 100 percent of the turkeys raised by Jennie-O Turkey Store are housed in open barns.

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Medications

Through each phase of production, we expect employees at our farms and producers that supply hogs and turkeys to Hormel Foods to practice the judicious use of medications. Our producers and veterinarians use medications responsibly because nothing is more important than public health, including a safe food supply and animal well-being.

Licensed veterinarians prescribe approved medications and dosage levels to properly treat, control and prevent illness in animals. These items are all regulated by the Food and Drug Administration, which evaluates the medication’s possible affects on human health and the environment and impact on resistance. Furthermore, the agency has the authority to ban animal drugs it feels are a risk to human health.

We also follow industry programs outlining guidelines for using medications such as antibiotics responsibly. These programs include the National Pork Board’s “Take Care – Use Antibiotics Responsibly” and the American Veterinarian Medical Association's “Principles of Judicious Therapeutic Use of Antimicrobials.” These written procedures are one of the many safeguards in place to ensure antibiotics are used to keep animals healthy without harming public health.

In addition to endorsing the “Take Care – Use Antibiotics Responsibly” program from the National Pork Board, Hormel Foods requires all producers to sign the company’s “Quality Management System” document, which requires that all hog producers who supply hogs to Hormel Foods and employees of these producers who work with hogs to be certified in Pork Quality Assurance (PQA) Plus. This program focuses on 10 good production practices (GPP), which includes a chapter about proper antibiotic use. An additional six GPPs cover topics about medication.

At company-owned hog and turkey operations, we have seven licensed veterinarians who are responsible for overseeing the direction and management of all livestock health assurance programs. At our hog operations, the veterinarians are responsible for ensuring the guidelines outlined by “Take Care. Use Antibiotics Responsibly” are followed and all employees who work with animals are PQA Plus certified.

In addition to the work we have done with our producers, we have increased monitoring for antibiotic residues at our production facilities as well. Along with the random statistical sampling testing performed by the U. S. Department of Agriculture (USDA), we have initiated our own testing program using the Charm KIS rapid test. This is the same test the USDA has provided for their inspection personnel to use. Since 2008, we have conducted random residue testing on more than 4,900 hogs. These test results confirm our producers are using antibiotics responsibly and are following the GPPs identified in the PQA Plus program. With these steps, we are able to assure our customers the pork products produced from these animals meet the highest standards for food safety and quality.

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Animal Care Research/Innovation and Investment

At Hormel Foods, we continually evaluate, invest and develop new ways to improve our hog and turkey handling processes.

We operate a state-of-the-art hog holding facility at our plant in Austin, MN. This structure was developed with animal care and working conditions for employees as the top priority. Additionally, we have received a patent for our process related to improving turkey handling at Jennie-O Turkey Store.

At our processing plants, we invest in employee training to ensure workers are educated about the proper way to handle and move animals throughout our facilities. All personnel involved in receiving hogs and turkeys at our processing facilities are routinely trained to guarantee proper and humane handling of all animals. We also require that these employees review and agree to follow a personal pledge of conduct on an annual or quarterly basis. This document outlines principles for animal care and handling.

In addition to training, we conduct routine audits at our facilities and hire third-party auditors. We use information from each audit to continuously improve our animal handling procedures.

Documentation is an essential element of our training and auditing procedures. Within our records, we keep a copy of each audit report and a file for each employee that outlines his or her training and recertification qualifications.

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Industry Representation

Industry representation in national and local organizations helps Hormel Foods share ideas and best practices within the food industry regarding animal care and handling and humane processing. We are proud to have a representative serving as a member, as an officer or on the board of directors of various industry organizations, which include:

  • Alliance for the Future of Agriculture in Nebraska
  • American Veterinary Medical Association
  • Midwest Food Processors Board of Directors
  • Midwest Poultry Research Committee
  • Minnesota Turkey Federation Board of Directors
  • National Feed and Grain Association
  • National Turkey Federation’s Board of Directors
  • National Turkey Federation’s Executive Committee
  • National Turkey Federation’s Health and Welfare Committee
  • National Turkey Federation’s Issues Management Committee
  • National Turkey Federation’s Live Production Committee
  • National Turkey Federation’s Technical and Regulatory Affairs Committee
  • Northwest Feed Manufacturers Association
  • Professional Animal Auditor Certification Organization
  • State of Wisconsin Livestock Facility Siting Review Board
  • Texas Tech International Center for Food Industry Excellence Board of Directors
  • United States Animal Health Association
  • University of Wisconsin Meal Science Advisory Board
  • University of Wisconsin Poultry Science Advisory Committee
  • Wisconsin Agriculture Coalition

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Industry Collaboration

Treating animals humanely is simply the right thing to do. This philosophy carries through in our openness to share our company’s best practices and state-of-the-art facility designs with other companies and individuals involved in the industry. We accomplish this through hosting representatives for first-hand tours of facilities, industry presentations and industry collaboration. Within the hog and turkey industries, Hormel Foods is seen as a leader for developing and implementing animal care and handling procedures.

For example, we support and participate in the Professional Animal Auditors Certification Organization (PAACO) by inviting trainers and trainees to visit and see first-hand our hog facilities and turkey facilities as part of the real-world training component of the program. Eleven members of the Jennie-O Turkey Store team and Hormel Foods teams are PAACO-certified auditors. One of our Hormel Foods employees is also a certified instructor for the program. To support continuing research within the turkey industry, Jennie-O Turkey Store provides support to the Minnesota Turkey Growers Association, the Minnesota Turkey Research and Promotion Council and the National Turkey Federation.

Read more about our commitment to animal care:

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Supply Chain

Hormel Foods has a complex supply chain with suppliers for hogs, turkey, ingredients, packaging materials, transportation and more. As part of our ongoing assessment of how the supply chain fits within our overall corporate responsibility and sustainability initiatives, in 2010, we developed Supplier Responsibility Principles that outline specific areas of responsibility with which we expect our suppliers to comply. We plan on launching these principles with suppliers in fiscal year 2011.

During production, many factors are involved. This diagram illustrates the components necessary to produce a product and the resulting outputs. Our main focus for measuring our impact on the environment is our production because we have direct responsibility for these operations.

Agricultural commodities and distribution/consumption fall primarily outside of our direct responsibility, since the majority of these items are purchased from independent farmers. We acknowledge we do have influence and are always looking for ways to ensure our values and principles are upheld throughout our supply chain.

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Evaluation of Suppliers

Hormel Foods is a champion of continuous improvement and we extend this continuous improvement challenge to our suppliers through our Supplier Quality Management (SQM) program. Through our SQM program, we measure suppliers based on quality, delivery, service, technology and price. Our ingredient suppliers are subjected to additional measurements to further ensure the quality and food safety of our supply chain.

To ensure compliance from our suppliers to our SQM standards, we utilize a combination of third-party audits, internal audits and self audits.

Suppliers who exceed our established standards for audits, degree of compliance and other criteria, are eligible for our annual Hormel Foods Spirit of Excellence Awards. In 2010, 58 suppliers received this recognition for their 2009 performance. More recently, we also awarded 65 suppliers for their performance in 2010.

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Supplier Diversity

Our policy states that Hormel Foods is committed to providing a respectful and inclusive environment where our employees, customers, consumers and suppliers grow and succeed. Our supplier diversity program provides businesses an opportunity to provide quality product options that meet the company’s growing business needs.

We are committed to providing opportunities to diverse suppliers, such as women-owned and minority-owned businesses, which provide the highest quality materials and services to our internal and external customers on a timely basis at the best economic value. Suppliers can submit their business for consideration at https://suppliers.hormelfoods.com.

In fiscal year 2010, we purchased 17 percent of our resources from small businesses. Of these small businesses, 1 percent was women-owned or minority-owned businesses. This information includes the independent family-owned hog farmers.

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