ROSE HILL -- God gave Eastern North Carolina a fine, sandy soil that grows the world's best tobacco. It took a man named Wendell Holmes Murphy to make it sprout pigs.

Murphy took an old idea, adapted it to swine and literally changed the way pigs are raised. Twenty-five years later, North Carolina's pork industry sets the pace for the nation's, and Murphy is America's undisputed King of Hogs.

The one-time high school teacher now presides over the biggest swine company in the United States, an interstate empire that sold nearly $200 million worth of hogs from North Carolina alone during the 1994 fiscal year.

But Wendell Murphy's influence extends over far more than just hogs.

The former five-term state legislator remains one of the state's most politically powerful figures: a man who attends basketball games with Gov. Jim Hunt and gets firsthand reports from committee chairmen on legislation affecting his business.

He serves on the Advisory Budget Commission, which helps set the governor's spending priorities. He has served on the boards of two banks, a half-dozen college foundations, the N.C. State University Board of Trustees and the Research Triangle World Trade Corp. He flies former presidents and governors in his company aircraft and provides financial backing for numerous Democratic candidates.

His influence makes him an invaluable asset to the swine industry and to other agribusiness interests. It also makes him an irresistible target to groups who oppose the unbridled growth of hog farms.

The Wendell Murphy story, whether told by allies or enemies, has a legendary quality that has only helped to boost Murphy's fame in his home state and in the Midwest. It's a story about a man who started humbly and achieved spectacular success by working harder, making shrewder decisions and thinking further ahead than anyone else.

Along the way, Murphy became a master at the games of business and politics. But he says he never ventured far from his modest Duplin County roots.

"I'm just a country boy who grew up on a small farm with tobacco and a few pigs in the back yard," Murphy said in a recent interview. "Frankly, I don't know much about raising hogs. But fortunately, we have some people that do."

One good idea

All it took was one good idea and $3,000.

That's all that schoolteacher Wendell Murphy had in 1961 when he decided to build a feed mill in his hometown of Rose Hill. According to the now-classic tale, Murphy and a math teacher named Billy Register were riding around one afternoon when they happened to pass a small mill near the town of Warsaw.

"You know, I believe one of those little feed mills would go good in our community," Register said. And just like that, a new career was launched.

"It was just like lightning. I mean, it just came to me all at once," Murphy remembered. "That's exactly what I wanted to do."

But building such a mill would cost at least $13,000, and Murphy had only the $3,000 -- the scrapings from his teaching job and his wife's income as a clerical worker. What happened next is still described by Murphy as one of the toughest business encounters of his entire life.

He went to see his dad.

"The hardest sell I ever had to make was trying to convince Daddy to co-sign that $10,000 note," Murphy recalls. "He didn't loan me the money because he didn't have the money. Our little farm had never had a mortgage on it, so I didn't dare asked him to mortgage the farm. I just asked him to sign with me."

Holmes Murphy finally agreed, but on one condition: The younger Murphy would keep his teaching job until the debt was paid.

For the next three years, Murphy held two full-time jobs. During the day, he was a vocational-agricultural teacher. At night he would tend to the mill.

"Sometimes Wendell would have to stay all night at the grain mill, sleeping in his car and looking after the milling process," said Terrence Coffey, a former N.C. State professor who is now head of operations for Murphy Family Farms. "He'd take his kids to school in the morning and then go to work teaching school."

Financially, the mill was an immediate success. Murphy quit teaching. But it soon became clear that he could do even better.

For starters, he saw profit potential in the corn husks and cobs that other millers were simply throwing away. He began grinding the cobs for cattle feed and saw his earnings grow from $100 to $300 a day.

When new combine machines hit the market, threatening to make traditional feed mills obsolete, Murphy countered by borrowing an idea from his customers:

He went into the pig business.

He bought feeder pigs on sale, raised them on dirt lots on his farm and fed them with corn from his mill. Before long, he was making more profit feeding his own animals than he made selling feed to others.

In 1968, he closed his doors to the public. But during his short career as a feed vendor, he developed a business style that would set him apart from his peers.

"We've always done what others would consider inconvenient," Murphy explained.

"On Saturday nights, we'd be still shelling corn at midnight, and the neighboring businesses had closed up at noon," he said. "That same principle we've applied throughout our entire business: to look around and see what we can do that other people chose not to."

A new way to farm

Murphy's biggest contribution to swine production was born of adversity.

The pork industry's first foray into contract farming came in 1973 as Murphy was searching for ways to recover from a devastating hog-cholera outbreak.

Whenever a farm was struck by cholera, federal agriculture officials would order the animals destroyed and slap a quarantine on the property. Farmers couldn't bring in new pigs until the quarantine was lifted.

Murphy decided he couldn't afford to wait.

"Rather than wait until that quarantine was over, we immediately looked for our first contract producers -- neighbors who would use their farm," Murphy said. "We furnished the wire and the fence posts; they furnished the labor."

It was a concept that was already in wide use in the poultry industry, but Murphy became first to adapt it to hogs. He paid his first growers a fee of a dollar per pig to raise his animals on dirt lots. Later, to keep up with changing technology, he switched to climate-controlled confinement barns and automated feeding equipment.

Hundreds of North Carolina farmers were drawn to Murphy's contract as way to earn money while protecting themselves from the fluctuations of a volatile market. By the mid-1980s, Murphy was ready to export his methods to Iowa and Missouri, where feed costs were cheaper and packing plants more accessible.

By 1987, Murphy Farms was the biggest hog-producer in the country, and contract hog production was becoming an industry standard.

"We did that first," he says. "I don't think anybody in America contracted hog production before we did, where we accept all the risk as ours with a guaranteed return to the contract producer.

"Now just about everybody is trying to do it."

Murphy to the rescue

Meanwhile, Murphy was already establishing himself as a player in the General Assembly in Raleigh. There, he would earn a reputation as a powerful friend of agricultural interests --a man who could get things done.

Murphy's wealth and influence were always in demand whenever small crises arose. Who else but Murphy, for example, could have swooped in to rescue the the N.C. Museum of History from disaster on its opening day?

The date was April 22, 1994, just hours from an opening ceremony where all five of the state's surviving governors were to participate. But at the last minute there was a snag: Former Gov. Jim Martin, just returning from a trip abroad, was stranded at the Atlanta airport and unable to catch a flight to Raleigh in time.

Enter Murphy. He pressed his corporate jet into service to pick up Martin and deliver him to the ceremony.

Murphy neither asked for nor received compensation for the flight. It was typical Murphy style: generous in an unassuming way. Asking for nothing but quietly piling up IOU's that he might cash in later. Or might not.

Murphy has repeatedly flown state officials to out-of-state conferences and even flew Democratic elected officials to the national Democratic Convention in New York in 1992.

He has given more than $530,000 to his alma mater, N.C. State, and used his influence to secure state funding for the university's Centennial Campus and proposed new basketball arena.

Murphy is proud of his contributions to N.C. State, which he calls the "finest institution in the world." Along with his father, the university is "the reason for everything that I am --all the good, none of the bad."

These days, Murphy says, he is concentrating on his company and a possible expansion into meat processing. He predicts that Murphy Family Farms will continue to flourish for the same reason it always has: its readiness to change with the times and adapt to new opportunities.

"Our trademark --our hallmark if you will --has been our willingness to recognize that change is inevitable, that we can not continue to do in the future exactly what we've done in the past," he said. "In almost any business it's that way. Politics is that way.

"People who resist change are just going to get left behind. "

As for his political future, Murphy wouldn't comment on speculation that he may eventually run for governor or state agriculture commissioner. But he notes that North Carolina has a history of elevating its rural sons to positions of power.

"I remember Kerr Scott, Bob Scott," he said, referring to the father and son from Haw River who became governors. "There's Jim Hunt. I tell you what, they've done a pretty good job, these country boys. Haven't they?"

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