Thursday, May 14, 2009

May 14, 2009

The market came back with a vengence and rightly so. Hog numbers are dropping and will keep dropping until certain factors change. Our media people lost interest in the flu because nobody was dying from it like they did in the early 1900's. Imagine that! There were more people dying from the regular flu than this one. The market is now back to where it was before the flu and has actually put more on more money ($67.10 top as of 5/13/09). That is quite a rebound from the $50.50 bid on 5/5/09. The damage has been done and we have to pick up the pieces and move on. The factors that need to change are:

1. The government support of the biofuels business needs to be stopped or give the livestock producer the same breaks. This has add about 33% increase to our feed costs. These fuels do not make sense because it cost more to produce them than they can sell it. In any other business you would not stay in business with these circumstances.
2. The banking industry is putting the squeze on livestock producers even more so when we had $9.00 hogs. Market hogs are still bringing back $120 + per head and will keep bringing that and more.
3. Everybody needs to work together on feeding out livestock. This is from the guy who produces the pigs, the feeder and the feed company. We can't count on the Packer because his job is to buy them as cheap as possible. We need to work together on this situation right now and then we will be able to reap the rewards in the future.

I get asked every day on my feelings on the market and all I can say is that it is going to get better. Most people I know work hard in this business and are working harder now! Be a survivor!!!!

Market hogs: $65 to $67 or $50 live

Feeder Pigs: SEW--$24 to $30 hd delivered
Feeder Pigs: $48 to $52 on a 40 lb. base

Corn: $3.79 to $3.89
Soybean Meal: $357.00
Break even: Feeder Pigs: $71.60
Wean to Finish: $75.88

Graduations are this weekend so go congratulate that graduate. Look into their eyes and notice that look of optimism of going to the next step of life. Try to bring that home to your operation.

Have a great week and be careful with the fieldwork!

Jim Noethe

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