January 25, 2008

Hog producers express worries at Pork Congress
 

Rising feed costs and lower hog prices are creating a massive challenge for the hog producers.
 

Iowa's 5,000 hog producers who attended the 2008 Iowa Pork Congress at HyVee Hall on Wednesday (January 23, 2008) are concerned about what this year holds for them.

Iowa Pork Producers Association president, Dave Moody, said there is no doubt economic challenges will be a big part of what they do in 2008.

Many analysts said the hog producers would see further losses in this year after a record 35 consecutive months of profits ended a year ago.

According to Iowa State University's (ISU) estimated livestock returns, the state's hog producers suffered average losses of more than US$25 for each hog sold in November and December. The cost of producing a 270-pound market hog is up 12.3 percent compared with a year ago, yet sales price of the same 270-pound market hog have dropped by 19 percent. 

President of Paragon Economics and pork industry client consultant, Steve Meyer, said available opportunities are not good.

He said while some producers are making the decision to go to zero production, other producers have to cut production enough so that prices will rise above costs. When that happens, prices for pork will rise as they already have for poultry, milk and some other commodities, he added. 

However, exhibitors at the Congress said they did not see a decrease in the number of hog producers who turned up for the trade show.

At the Iowa Pork Industry Center booth, an ISU Extension swine field specialist in Sigourney, Terry Steinhart, said hog producers should have used the profits they earned during the past three years to prepare for such hard times.

He said he hoped the producers had paid some loans and is able to withstand some losses until the market improves.