November 28, 2006

US swine industry to shrink if high corn prices hit

Agricultural economists are concerned that more people would be leaving the pork industry as prices rise as ethanol demand soars in the country.

Pork producers are expected to suffer the most as more corn supplies are diverted to energy.

If corn prices continue to rise to US$4 a bushel, the pork industry stands to lose 10 - 15 percent of its animals nationwide, Iowa State University livestock economist, John Lawrence said.

Corn-producing farmers who also raise hogs are expected to be some of the first to bail out. Glenn Grimes, University of Missouri economist said some farmers are feeding hogs to make extra money. When hog-raising becomes a money-losing proposition, they would begin to lose interest and abandon the industry.