Optimal Exports as a Portfolio Problem

If you think about it, each dollar of expected pork revenue, as we look at 2009, has a variance around it. That is to say, not every lb of forecasted sales has the same likelihood of being realized. It is safe to say that the anticipated level of demand from domestic consumption is well known and relatively low variance. The demand which originates from the export markets is highly variable and can come from surprising places. Because of this, there is no doubt that the expected income variance is much higher for export sales than it is for domestic purchases and as you might suspect, it has a higher expected value. Those two attributes tend to go together.

2009 IPC: Iowa Environmental Regulations & Nuisance Case Update

Iowa Environmental Regulations & Nuisance Case Update, Eldon McAfee, - Beving, Swanson & Forrest, from the 2009 Iowa Pork Congress, January 28 - 29, Des Moines, Iowa, USA.

Raising hogs in a manner that protects and improves the environment is a practical and achievable goal for all pork producers. Eldon will cover Iowa DNR regulations and recommended practices focusing on manure application, including rules on manure application on soybeans as well as the proposed rule on manure application on frozen or snow-covered ground. Eldon will also discuss how the recently released final federal EPA CAFO rule applies to Iowa livestock producers. In addition, Eldon will analyze three Iowa jury verdicts in nuisance cases in 2008 that were favorable to livestock producers.

SwineCast 0374, Food safety conversation: consumer trust of food safety

SwineCast 0374 Show Notes:

  • Food safety conversation with Maple Leaf representatives following the massive recall last year.  What went wrong... and what they did right
  • Speakers at the Center for Food Integrity's Annual Summit look at food safety as a key component of consumer trust and business profitability

Here is All You Need to Know About MCOOL

     According to the USDA talking points released yesterday (1/12/2009) regarding the final estimates for implementing country of origin labeling:

1. The first year implementation costs for directly affected firms is estimated to be 2.629 billion dollars.

2. Costs per firm are estimated to be $370 for each producer, $48,219 for intermediaries, and $254,685 for each retailer.

3. The estimated cost in higher food prices and reduced food production in the tenth year after implementation is 211.9 million dollars.

     Now for the benefits expected:

     "The expected benefits from the implementation of this rule are difficult to quantify.  The Agency's conclusion remains unchanged, which is that the economic benefits will be small and will accrue mainly to those consumers who desire country of origin information." 

2009 and Beyond Part II

     Worldwide demand for natural resouces, value-added food items and consumer goods is down sharply as a dramatic slowdown of the world's largest economies continues.  The contraction phase of this worldwide recession is still underway at the beginning of 2009 and will likely continue well into at least the first quarter. 

     One of the reasons it is hard to predict when the recession will bottom out is that there are most likely still "land-mines" of hidden corruption yet to be exposed and absorbed as losses by the remaining productive sectors.  These losses occur in business processes and supply chains that are linked, so that a kind of domino effect or snowballing contraction must take place before the full impact of each phase of the slowdown is fully realized.  This takes time and tends to come in waves, as tipping points are finally breeched.

2009 and Beyond: The New Strategic Environment, Part 1

     Sometimes its hard to tell if recent events, like the generalized global economic meltdown, cast a shadow that is a vapor and will burn off as the sun comes out again, or whether they are a harbinger of a more persistent, new strategic environment in the global market and political system.

     There is certainly a feeling in the air that some substantial things have changed but time will tell if they are persistent or even fully realized.  Some of the things which form the emerging global situation that U.S. agricultural will operate in include:

SwineCast 0357 for November 18 2008

SwineCast 0357 Show Notes:

  • Talking with representatives from the Colorado Pork Producers about their agreement with the HSUS and why.
  • How a major university dealt with questions from the student body on animal welfare concerns and food service selections based on husbandry practices.  For additional information on the booklet developed by CFI, call the Center for Food Integrity at (816) 880-5360.
  • What Baby Boomers want and why... University of Manitoba discusses research with focus groups on issues the aging generation is concerned about as regards nutrition.

Pork Producers Unable to Defend Use of Stalls

It has become obvious that neither industry spokespeople or producers can articulate a convincing defense for the use of typical industry standard stalls in farrowing or gestation.  Because of this, and unless this changes, the industry can expect the geography over which they will not be allowed by law will expand until they are a thing of the past.

While those who hear the arguments against crates don't analyze it at the level of philosophy or academic ethics, the priniciple reasoning which is mounted to oppose crates comes from natural law and a kind of anthropomorphic appeal to the modern version of utilitarianism.  

SwineCast 0354 for November 7 2008

SwineCast 0354 Show Notes:

  • Special post-election insight on new administration's transition and impact on agriculture  
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