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Veteran Contributor

hog commentary

Jim Long has his commnts on the pig site. He states while hog kill is down hog weights are up to the extent that hogs on feed equal a year ago. I guess that answers the question about PEDv killing demand for corn. In fact the reason hogs are killed at a lighter weight is because of a better feed efficiency. Saying it differently hogs will eat more corn than a year ago. He questions the price of hogs with these numbers, he is always a bull.

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Senior Contributor

Re: hog commentary

When I had hogs, we had a buyer that would take them from around 225-300#, for the same price per pound.   Said he could tell the price of corn, without ever looking at a chart, by how heavy of hogs people would bring in.   If corn was high (at least compared to hogs) they were 230#, if corn was cheap, they were 290#.

Myself, when I took one to the local packer to be processed for my own eating, I liked them to be 300-320#, but my hogs were lean, and high yielding compared to the average.   On the kill sheet, I had them yield over 78% from time to time.

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Advisor

Re: hog commentary

I'd never be able to prove it but that doesn't stop anybody else from rank speculation, so..

 

I was trying hard to get a handle on the extent of the PED-V losses and found everybody who was halfway close to the situation to be very close mouthed. In all fairness, not sure what I might have found actionable if it were the old days and there was talk of rampant TGE through a tough winter.

 

But as to my rank speculation, I'll take a wild stab at suggesting that the bigs all held their cards close and then more or less simultaneously pulled their hedges and then once the momos took futures a lot higher, dumped new hedges onto the suckers.

 

That would actually be a slam dunk case against the arguments of the social utility of the new fangled ogilopolistic configuration.

 

BTW, Verizon could put ATT out of business if they chose to, it would just be far more costly to them than just finding a middle ground of semi-collusion.

 

All pretty old fashioned Adam Smith, Theodore Schultz sort of stuff, though.

 

Back to Schultz, I think it remains fascinating that the foundations of the dominant Chicago School of economics go back to his work (using the reams of historical hog data from da guvmint) on the hog cycle and corn/hog ratio. It is a pretty ephemeral question, but what happens when you've been worshipping the free market so long that you don't recognize when you don't have one?

 

 

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Honored Advisor

Re: hog commentary

great final statement there nox. 

 

holding for bigger weights may be the adjustment for the death spots in the finishing barn to come.  Boosting the total pounds produced at the expense of feed effeciency.  With a strong market it is to be expected.  

 

In that respect the corn use does not take as big a hit as expected.  

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Honored Advisor

Re: hog commentary

Only problem with your myth Hardbody is that the facts do not support your theory.

 

Open Interest by hedgers has been extremely consistent all the way up and then this little dip.

There were no "insiders" who all lifted and then dumped back on it higher.

 

You are right that there is no free market in hogs and never will be again, but the bigs are far dumber than you assume. PRoven by the fact that they go broke every few years. :-)

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Veteran Contributor

Re: hog commentary

Which proves the point why most of us quit the hog buisness. It is alfull hard to compete against a dumb ass.

 

 

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Honored Advisor

Re: hog commentary

Very well said.

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