Its interesting to note the direction of cash hogs prices and market hog weights that have been printed since July first. With the record heat we saw the cash prices climb for 10 weeks while we saw the weights drop off resulting in some good profits for hog producers. One has to think that it doesn't take a rocket scientist to see what happens when the industry cuts weights to bring in the black ink. Heavier hogs take more feed, less efficient in feed coversion,harder on equipment and employees and put profits in jeopardy. Pigs marketed 6-10 lbs lighter take less feed and less corn causing less demand for inputs which could result in cheaper corn prices.
When mentioning these thoughts to a large feed company rep he stated that indpendent producers, as we are, market hogs ususally around the 198-200 carcass where your packer hogs always are in the 215-220 lb bracket. There within lies the problem.
Its a simple solution -one that the chicken industry has ignored and now is finally realizing in cutting back in tonnage and egg sets because of the tremendous red ink. One could only hope the NPPC and state pork leaders would point out and encourage all producers to cut back tonnage -look at the charts since July 1st - Those who fail to ignore history are only doomed to repeat it .
Re: INTERESTING DATA
Does the data also tell us if the packers are supplying for buyers' guidelines that include heavier hogs? Nevertheless, they will do what pushs more lbs of pork per hour. The independent producers' time stops at the market gate.