Economics

Less Supply for Languishing Demand

     As demand continues to languish, Smithfield plants in the midwest and Tyson slowed kills as a means to boost prices at the wholesale level.  The strategy appears to have worked as the LS500 (Carcass Composite) price picked up over $10/cwt in the last 10 days but live prices remained stuck in the mid to upper $50 range. 

     USDA reports year-to-date slaughter down a little over 4%, just shy of 2.6 million head.  The biggest problem remains the export markets where May results revealed exports down over 30% from a year ago.  Japan was perhaps the biggest disappointment since its demand had remained firm until the recent report where the month over month decline was just over 13% and the year over year decline over 15% in tons shipped.  China and Hong Kong are returning to 2006-2007 levels and were down dramatically since the purchase boom of last year.

SwineCast 0436, Looking Back At PRP And To Future Profitability

SwineCast 0436 Show Notes:

  • AgStar's Mark Greenwood joins us for a look at the short-lived Producer Retirement Program and a need to look at the industry in a new light

SwineCast 0435, Climate Change Legislation May Burn Agriculture

SwineCast 0435 Show Notes:

  • Congressional Republicans say negotiation process has excluded ag interests and may permanently hamper competitive position worldwide

SwineCast 0433, Economist Looks at Impact of Prop 2 Like Legislation in Ohio

SwineCast 0433 Show Notes:

Tastes and Preferences

     We usually think about demand in the two dimensional way that we are restricted to visualizing it in with a graph.  That is, the amount demanded is a function of price.  In actuality there are several other factors which determine demand that are embedded in those graphs but not visualized.  For instance, we know that the level of income influences demand as does the availability and price of substitutes and something called tastes and preferences.  For instance, if you hate carrots, lowering the price is not likely to induce more quantity demanded, though we might show the demand curve for carrots for a group (like people in the U.S.) as a function of the price.

Glenn Grimes - Market Outlook

Glenn Grimes - Market Outlook

Market Outlook

Glenn Grimes, PhD, Professor Emeritus, Ag Economics, University of Missouri - Columbia, Missouri

From the World Pork Expo, session sponsored by Fort Dodge Animal Health during the 2009 World Pork Expo in Des Moines, Iowa, USA.

Russian Roulette with Three or Four Chambers Loaded

     The pig production business has always had its ups and downs but developments over the last few years have resulted in the structuralization of increased levels of price and financial risk.  By structuralization, I mean that these factors are now regular, recurring added risks that are no longer random, isolated events which no risk management process can adequately predict or mitigate effectively.  The factors include the predicted and now realized reduction in the average level of the stocks-to-use ratios for corn and soybeans placing feed prices in a continuing, annual, heightened state of price risk volatility.  Bob Wisner, retired crop extension professor from Iowa State University told World Pork Expo attendees that we will end up the soybean year with as little as 2.2 weeks of the supply remaining.  The cold, rainy corn belt conditions which delayed the corn planting period in the U.S.

SwineCast 0429, Producer Retirement Program Questions and Answers

SwineCast 0429 Show Notes:
Industry buzz on the Producer Retirement Program continues. This question and answer portion from the first webinar presented on June 9th walks thru questions from producers and allied industry members. Answering are AgStar's Mark Greenwood and PRP Chairman Chuck Wirtz.

SwineCast 0428, WPE - Conversation with Dr Steve Meyers

SwineCast 0428Show Notes:

  • Time with Steve Meyers as we look at the industry response to H1N1 and learnings in preparation for a future of immediate media worldwide
Economist Dr. Steve Meyers discusses recent events and their impact on our industry as well as factors we may need to implement, to return to operating in the black. Meyers examines current issues that are working against us, such as the misnaming of the H1N1 virus, increases in grain costs, declining export markets, and near record sow numbers. Immediate solutions lie in production decreases through culling sows and liquidating farms. Also conversed are the long-range keys to our success, which are currently unfolding, and the potential impact from a future, poor grain crop.

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