October 21, 2008


Input costs forcing Iowa hog farmers to reduce confinement buildings

Higher feed and fuel prices, combined with a troubled economy and weakening demand, have led to Iowa farmers building less hog confinements this year.


Increasing building costs have also slowed constructions that took off between 2002 and 2007.


The Iowa Department of Natural Resources said construction permits for hog confinements are issued at about the same rate as last year, but experts claim the cost of inputs have increased 27 percent.


Hog farmers are looking for ways to streamline their operations for efficiency or otherwise just scaling back on overall construction, according to Aaron Putze, executive director of the Coalition to Support Iowa's Farmers.


Putze said farmers are likely to become selective of growth in future construction.


Hog production was keeping up with demand and was increasing to supply growing markets in Asia, but several factors had set the original plans in disarray.


Iowa State University economist John Lawrence said a stronger dollar had weakened US exports after the global economic slowdown, which indicates shrinking overseas hog markets.


As of September 1, there were 19.8 million hogs in Iowa, up 900,000 from a year ago, according to the USDA.


Farmers are now battling the lack of demand by reducing supply, including cutback in breeding sows, Lawrence said.