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Corn Prices Make Pig Farming Ugly

by 5m Editor
8 February 2008, at 7:55am

US - Minnesota pig producer John Vaubel says he losing at least US$35 a pig. He blames the massive escalation of corn prices for the 'ugly economics'.

Sitting at his dining room table, Vaubel eyes some worksheets. The words and numbers scrawled on the paper sum up the state of his business for this hog producer.

“The economics are pretty ugly,” Vaubel said. “We’re probably losing at least $35 a pig, maybe $40, ” he says

His family operation, near Mapleton in southern Minnesota, sells roughly 40,000 hogs a year. According to reports in the Daily Journal, things may change, but for a large producer like Vaubel, losses could top $1 million this year if the current low prices persist.

“The feed cost is the real problem,” Vaubel said.

On one worksheet, the word “corn” is underlined. Corn prices have more than doubled in the last year and a half. The price of soybean meal has also gone up. In all, Vaubel figures his feed costs per animal have risen about one-third.

“This is my livelihood,” Vaubel said. “We’re in the barn with the moms and the little babies, one-week-old babies.”

Standing in one of his hog barns, Vaubel says it will take a while before he starts making money again.

To make matters worse, high fuel prices have doubled the cost of transporting his pigs to a meatpacker. The hogs in this barn are headed to market next summer. By then, Vaubel thinks he might get a better price for the animals.

“Traditionally the summer markets are a little better,” says Vaubel. “I’m hopeful that these might break even, at best,” he adds, hopefully

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5m Editor