Thoughts on Pork Demand
Economic theory tells us that a consumer looks at his or
her utility function (a relationship that says “consuming X, Y and Z
quantities of goods that A, B and C provides me with various units of
utility or satisfaction to choose the given bundle of goods that
maximizes total utility subject to his or her budget constraint. In so
doing, the consumer chooses amounts of each good that he/she will
consume at the prices offered, since the prices and quantities of all
goods determine just how far the budget will go.
Quantities consumed vary as prices vary, thus establishing each
consumer’s demand function for each good. The demand function tells us
how much of the product the consumer will buy at each alternative price.
Add up the quantity of each good consumed by each consumer at each price
and you have a “market demand” function for the good in question. At
each price, firms provide the quantity of goods demanded by
producers Feeling More Upbeat
In the last two weeks, I attended the World Pork Expo,
coordinated by the National Pork Producers Council, and the Pork
Financial Conference, sponsored by the National Pork Board. What a
difference a year makes. Producers and most everyone involved in the
pork industry have smiles on their faces – put there by profits most
haven’t seen for quite a long time. May was the best month that we
have seen for profits in almost three years. From a lenders'
perspective, operating loan balances are coming down and producers are
finally getting an opportunity to help get some improvement in their
working capital. We have a ways to go to get balance sheets back to
where they were, but we are heading in the right direction.
Capital Availability – I have had an opportunity to speak to a
couple of pork producer groups this past month regarding capital
availability. I reviewed some items that lenders are looking for as
they review producer portfolios. Following are a few items that I would
like to point out:
Aggressive Livestock Marketing Rulemaking Announced
USDA announced that on June 22, 2010, the USDA’s Grain
Inspection, Packers and Stockyards Administration (GIPSA) will publish a
proposed rule, as required by the 2008 farm bill and through existing
authority under the Packers and Stockyards Act, that would provide
significant new protections for producers against unfair, fraudulent or
retaliatory practices. Secretary of Agriculture Tom Vilsack said this
will be the “most aggressive rulemaking” since the Packers and
Stockyards Act was established in 1921. Vilsack said, “Concerns about
a lack of fairness and commonsense treatment for livestock and poultry
producers have gone unaddressed far too long. This proposed rule will
help ensure a level playing field for producers by providing additional
protections against unfair practices and addressing new market
conditions not covered by existing rules.” According to USDA, the
proposed rule announced today would provide the following
Discovers Variant H1N1 Flu Virus
Hong Kong researchers have confirmed that the H1N1
influenza virus has undergone genetic reassortment to give rise to a
novel H1N1 virus in pigs, according to a study done by the University of
Hong Kong released Friday.
The newly discovered virus has genes from the novel H1N1 virus and other
pig influenza viruses, which Hong Kong researchers say demonstrates that
the atypical virus may change in unpredictable ways in pigs, adding
concern that such viruses may impact global public health.
The Hong Kong study does not suggest that the particular reassortment
poses an immediate threat to humans, but the results emphasize the need
for systematic surveillance of flu viruses in pigs worldwide, the
June 23, 2010: Advanced Swine
Reproductive Management Workshop Lifelong Learning Center
For more information contact: Dave Stender by phone (712)
225-6196, fax (712) 225-3173 or e-mail email@example.com.
June 24, 2010: Advanced Swine Reproductive Management
Workshop, Plymouth County Extension Office
information contact: Dave Stender by phone (712) 225-6196, fax (712)
225-3173 or e-mail firstname.lastname@example.org.
July 18-21, 2010: 21st International Pig Veterinary
Society Congress, Vancouver Convention and Exhibition Centre,
Vancouver, British Columbia, Canada;
For more information
contact: (604) 688-9655 ext. 2 or email@example.com
or go to http://www.ipvs2010.com/.
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