Feeder Pig Imports and a GIPSA Rule Update
Readers will notice that our table of North American pork
industry data contains #VALUE errors for imports of pigs from Canada for
the week of July 10. That’s because no data were available from USDA
for that week. USDA’s website says simply, “The complete data set
used to compile this report is not available from APHIS. When it
becomes available the report will be disseminated.”
It’s a problem that rears its head now and then, but a quick look at
the weekly import chart in Figure 1 shows that the last two observations
for feeder pig imports are very low. Dan Bluntzer, research director at
Frontier Risk Management, discovered early last week that USDA had some
questions about the feeder pig counts in those two weeks and now AMS has
delayed the next week’s data. We’ll get it lined out eventually
but, in the meantime, I wouldn’t read too much into those two weeks of
less than 70,000 pigs coming south.
U.S. feeders and packers have figured out how to use these pigs
efficiently in the face of MCOOL-imposed challenges. Packers take
“Label B” pigs only on certain days in specific plants and
merchandise the pork primarily to export and foodservice markets where
it is not required to carry a label. It’s amazing how economic agents
adjust to new conditions if they have some freedom to do so.
Benchmarks for Profitability
I recently had the honor of speaking at the National Pork
Industry Conference held in the Wisconsin Dells. I focused on the
current financial state of the U.S. pork industry because there seems to
be a rather large discrepancy regarding how quickly producers are
Through May, we saw producers who broke even, while others recorded
profits of up to $18/head, year-to-date. In my presentation, I pointed
out that this difference could be illustrated by taking out hedge gains
and/or losses, and just looking at operational profits. That’s
essentially what we are seeing in our loan portfolio.
The main variance in the profit/loss picture is cost of production,
year-to-date. Some production systems have breakeven costs of $0.45/lb.,
live wt., while others run as high as $0.55/lb., live wt. The difference
calculates to over $27/head on a 270-lb. market hog. The major drivers
in these discrepancies are overall herd health and feed
Reprimands USDA on
USDA’s Grain Inspection, Packers and Stockyards
Administration (GIPSA) announced today that it was extending the comment
period on the proposed GIPSA rule on livestock marketing practices by an
additional 90 days. The comments will now be due by November 22, 2010.
The call for extending the comment period became very strong last week
during the House Livestock Subcommittee’s hearing on the proposed
rule. Also, Senators Blanche Lincoln (D-AR), chairman of the Senate
Agriculture Committee, and Saxby Chambliss (R-GA), ranking member of the
committee, and 15 other Senators had sent a letter to Secretary of
Agriculture Tom Vilsack asking for the comment period to be extended 120
days. National Farmers Union, R-CALF, and others had written the
secretary asking that the comment period not be extended.
Committee Sends Strong Message to USDA on GIPSA Rule — Members
of the House Livestock subcommittee sent a very strong bipartisan
message to USDA regarding the proposed GIPSA rule on livestock marketing
practices. The committee members told administration officials that the
Department had gone far beyond Congressional intent that was established
in the 2008 farm bill. The Department was reminded by both Democrats
and Republicans that many of these issues that GIPSA is proposing were
considered and defeated during the writing of the livestock title of the
farm bill. Some members complained that the proposed rules would
actually increase concentration, hurt producers, and would eliminate
some businesses. The Department officials said the rules were intended
to provide transparency, fairness and protect producers against unfair
practices. At the end of the hearing Congressman David Scott (D-GA),
chairman of the subcommittee said, “For you and the department to
arbitrarily go against the wishes and intent of Congress is serious.
The least – the least – you can do is to extend the comment period.
To move ahead would be the worst thing that we could do for the industry
Coalition Launches Ad Campaign Against Ethanol Increase
The American Meat Institute and 14 other industry and
environmental groups have joined forces in launching an advertising
campaign advocating more scientific testing as part of an effort to
convince Congress to reject calls to mandate boosting the amount of
ethanol in gasoline by 50%.
The campaign has the tagline, “Say NO to untested E15.”
Most gasoline sold in the United States contains 10% ethanol (E10).
Corn-based ethanol supporters want Congress to boost that to 15% (E15),
while some support a compromise to boost it to 12% (E12).
“Increasing the consumption of corn-based ethanol by 50% will increase
food and feed prices, driving up costs for meat and poultry producers
and ultimately consumers,” says American Meat Institute President and
CEO J. Patrick Boyle. “This controversial decision certainly warrants
careful and thoughtful examination considering the many negative
consequences increasing the blend will have.”
August 31, 2010: 20th Annual Carthage
Veterinary Service, Ltd. Swine Conference, Western Illinois University,
For more information contact: (217) 357-2811 or go to
August 30-31, 2010: Joint Strategy Forum on Animal
Disease Traceability, Renaissance Denver Hotel, Denver, CO
For more information go to: www.animalagriculture.org or
August 31-Sep. 2, 2010: Feet First Sow Lameness
Symposium, Hilton Minneapolis, Minneapolis, MN
information contact: (612)-376-1000 or go to www.zinpro.com/feetfirst.
According to a head-to-head trial1,
LINCOMIX® (lincomycin) is equally as efficacious for
ileitis control at 40 g/T as Tylan® is at 100 g/T. That
means you’ll spend a whopping 40% less for comparable results. Contact
your veterinarian or your Pfizer Animal Health representative to learn
1. Data on file, Study Report No. 768-9690-0-CPC-97-002, Pfizer
NPPC conducts public-policy outreach on behalf of its 43
state associations, enhancing opportunities for the success of U.S. pork
producers and stakeholders by establishing the pork industry as a
consistent and responsible supplier of high-quality pork to domestic and
world markets. Click here to learn
more and support your industry.
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