Articles - Economy

Just like the emergent molten lava from Mount Kilauea, so an historical metric of the US hog industry, having lay dormant for many years, is creeping ever so slowly over its profit destroying "trigger" level. That metric is the hog corn ratio.

Europe as a whole has a flat depressive profile with the prices in the minimum levels of the last three years.

All the ingredients required for a pig industry expansion: Oxygen (PEDv becoming manageable) + fuel (high profits and lower feed ingredient prices ahead) + a spark (intentions to farrow 3-4 % more sows).

All the European markets lower the prices very quickly to position their meat as best as possible with respect to its rivals. The search for alternative markets is essential…

September will be a bear market month. We still have to see the pace of the drops.

It' is not as simple as the larger pigs have better survivability...

During July Germany has made a strong challenge that is difficult to process for the whole of Europe.

We hear a lot of talk about optimizing profitability in grow-finish through reducing standard deviation of marketed weights and aiming that tighter weight group at the profit optimal average weight at the time of marketing. It’s a bit like playing darts, you want the darts to be in tight group but it is also necessary to be near the bull’s eye on the target.

The low supply sets the pace of the price of pigs, but there are many more factors at stake: multiproduct commercial flow from Denmark to US; Russia has just presented a proposal for the opening of exports from some countries of the EU, etc.

Current pig market weights are through the roof and at all-time highs for the modern period of meat pig production. We should be noticing a big decline shortly but…

If no disturbing health factors appear, this year will be remembered as a very positive one.

The next time you hear someone over lunch tell you the value of a tenth improvement in FCR, unless they are drawing a distribution on your napkin, tell them you don’t run an average pig business so you are not interested in their average values.

The Spanish price will rise until well into summer, and the range of the rise will depend on Europe.

Feed efficiency as it is measured by the feed conversion ratio (FCR) is basically an engineering concept. There are a lot of misconceptions about feed efficiency and even more surrounding the economics associated with it.

The future for the European pig producers seems clear and the heart of the matter lies in knowing how the different markets will reposition themselves.

Increased prices for pork will lead to decreases in quantity demanded by the vast majority of consumers, export and domestic. This is especially the case in the current structurally high unemployment situation which has seen inflation-adjusted per capita personal income fall steadily since the market crash of 2007.

We fear that in the short term, the collapse caused by the Russian closure will become more evident and, that with it, the price will inevitably fall again.

Shuanghui International’s goal is the Chinese government’s goal, to acquire long-term, low cost sources of China’s favorite meat by forming long term, low risk, globally coherent pork and agricultural resources chains and they are well on way to that goal.

It seems that the price has initiated its spring rise, but many factors intervene. Whilst the Russian borders are still closed the collapse of some cuts (especially fats) will be inevitable.

The Philippine Bureau of Agricultural Statistics reported an increased of nearly 2.4% in the country's hog production during the first half of 2013.

Time will tell if PEDV is the cause but weaned pig and feeder pig prices began to turn up in June, a couple of months ahead of their traditional seasonal bottoming with the turn toward seasonal highs which peak usually in February or March.

We are closing the financial year at the minimum level in the whole year, in a turbulent setting that will need three or four weeks to clarify itself.

When you earn a profit, you have created more tangible value than the cost of the scarce global resources used to create your final product.

Globalization is a fact, and regional or national peculiarities are progressively less important.