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Weighted Benefits - Reductions Could Help Prices

by 5m Editor
16 April 2008, at 12:37pm

MINNESOTA — Low hog prices combined with high feed costs are putting the squeeze on hog producers and hog producers need to re-evaluate market weights, says Mark Whitney, University of Minnesota Extension.

It was only a few years ago that hogs were selling for $55 per hundred weight and corn was $2 per bushel. It didn’t take a rocket scientist to figure out that marketing heavier hogs meant more profit. However, with hog prices closer to $40 per hundred weight and corn over $5 per bushel, the most profitable weight to market hogs has changed drastically.

He advises producer to check out an article published by John Lawrence of Iowa State University. It includes a spreadsheet describing how to evaluate when to market hogs and the benefits it may offer. You can find this information at www.ipic.iastate.edu/information/Market.weight (pdf format).

Supply Reduction

Here, Lawrence says that there is a call for lowering market weights to reduce supply. Slaughter weight is a variable under the producer’s control, and unlike the number of hogs coming to market, is one that can be adjusted in the short run.

It is also a dilemma for producers as lowering market weights does reduce supplies, but a large number of producers must participate for it to have an impact on pig prices.

However, given the current forecast for hog and feed prices, all hog producers should be evaluate their marketing weights and options to change.

5m Editor