Friday 27th January 2012

Pigs per litter increase ‘dramatic’

The pigs per litter number in yesterday’s hogs and pigs report raised some eyebrows.

The average number of pigs per litter during the last quarter was 10.03, up two-point-two percent from a year ago.  Jim Robb of the Livestock Marketing Information Center in Lakewood, Colorado says that’s a dramatic increase and raises some long-term concerns about the hog market.

“For example, fourth quarter 2012 forecasts have the slaughter in the quarter about 31 million head.  Back in 2007, we had 30.4 (million). In 2008, we had 30.2,” Robb says. “Those are manageable levels, but we do have to recognize that this productivity growth sort of compounds as we go through time.”

The rise in pigs per litter in the September 1st report was the second straight report in which the U.S. pork industry topped 10 pigs per litter.  The June 1st report marked the first time that had happened.

Robb doesn’t anticipate an issue in 2012.  But by 2013, he says, there could be challenges in having the barn space and demand potential to handle those productivity gains.

Record hog inventory in Iowa

According to the USDA’s latest hogs and pigs report, Iowa’s hog inventory on September 1st was a new record high at 20 million head. 

That’s up 400-thousand head—or two percent—from the June 1st report.  But Iowa Pork Producers Association president Leon Sheets of Ionia says that doesn’t necessarily mean there’s a big expansion taking place in Iowa’s hog industry.

“The market-sized animals slowed down because of the heat this summer, as the sows kept having pigs—and those pigs needed to go someplace,” says Sheets, “so it does raise an issue, but we haven’t had an extremely large surge in new production facilities being built in the last year or two that would accommodate an extremely large number of animals.”

However, Sheets says high feed and transportation costs definitely favor the Midwestern states right now.  The USDA report showed four percent increases in year-over-year hog numbers in neighboring states Illinois and Minnesota, while North Carolina—the second largest hog producing state behind Iowa—saw its hog inventory fall three percent to nine-point-one million.

And Sheets adds that the recent drop in corn prices has improved the profit picture for pork producers.

“You know, three weeks ago corn was $7.00. Today the market—depending upon your location—is going to be 6.00, 6.05, 6.10—so those numbers, based on what we’re receiving for our market products—make it flow out a little nicer,” he says.

Economist Shane Ellis of Iowa State University tells the Des Moines Register that hog producers have enjoyed a good year, with per head profits of over 21 dollars in August.  He says that number will probably drop down into the single digits for September—but it’s still a profitable time for hog production.

AUDIO: Leon Sheets (8:28 MP3)

Nebraska farm income forecast up 35 percent

A new report says farm income in Nebraska will reach five-point-four billion dollars this year—up 35 percent from last year and 30 percent higher than the previous record set in 2008.

And the Nebraska Business Forecast Council sees the good times continuing for a couple more years, at least.  It’s predicts farm income of four-point-eight billion in 2012 and four-point-seven in 2013.

While there are always uncertainties in agriculture—especially weather—University of Nebraska-Lincoln ag economist Bruce Johnson agrees that the outlook is very bright.

“There are some pretty strong fundamentals that are seemingly moving us into what some of us would kind of think of as a ‘new normal’,” Johnson says.

After a strong first half of the year, profits in the cattle sector have softened recently.  But Johnson says the reduction in cattle herds in the southern U.S. could create opportunities for Nebraska cattlemen.

“It might even present a stronger kind of market down the road here—in the next year or so—for this part of the country,” he says.

And Johnson adds that the robust farm economy is having a ripple effect on the entire state.

“It spills over into the manufacturing in the state and other parts of the Midwest—grain bins and center pivots and new equipment—all of that is showing a strong reaction,” Johnson says.

The report says that while Nebraska farm income represents less than ten percent of the state’s income, it is accounting for almost a third of the income growth in 2011.

AUDIO: Bruce Johnson (7:23 MP3)

Report predicts sharp declines in 2012 meat and poultry output

U.S. meat and poultry production is headed for what’s described as a “precipitous fall” by mid-2012, according to a new report from ag lender Rabobank.

Beef production, in particular, will drop off sharply over the next twelve to eighteen months.  The report predicts year-over-year declines in beef output of six percent in the third quarter of 2012 and seven percent during the fourth quarter of next year.   

Poultry production will also drop off significantly over the next year as the industry adjusts to higher production costs and record losses.

Rabobank’s Dave Nelson says the sharp declines will create concerns for everyone from foodservice operators to corn producers.  He says the reduction in the domestic production of beef, chicken and pork will have a significant impact on corn demand.

ASA proposes ’12 Farm Bill plan

The American Soybean Association board has approved a proposed safety net approach for all growers for the 2012 Farm Bill.

ASA President Alan Kemper, a soybean producer in Lafayette, Indiana says their “Risk Management for America’s Farmers” plan would take care of the part that isn’t covered by crop insurance. He tells Brownfield their plan is commodity specific with revenue and yield benchmarks for individual farmers.

“This is not based on county, district or state yields or disasters with that, so, each farmer can tailor it to their own particular farm,” says Kemper

When it comes to overall budget savings, Kemper says ASA members want that to come out of direct payments and/or conservation,

“Our soybean farmers say that they’d rather have the risk management tools of the extra protection on price and yield and if they have to sacrifice some of the conservation payments they would be willing to do that.”

Kemper says he understands their approach is not exactly the same as other commodity groups’ but shares the revenue-based approach of the others. ASA is presenting their plan to the deficit-reduction Super Committee and leaders of the House and Senate Ag Committees.

AUDIO: Alan Kemper (4:00 mp3)

Thursday midday cash livestock prices

Packer inquiry into the cattle is light on Thursday. There are a few bids in the South at steady money with last week at 116.00. One major in Nebraska has indicated a willingness to pay 185.00 dressed, about 2.00 higher than last week’s weighted average. Processing margins are tight, and they may get tighter by the end of the week if cutouts remain on the sluggish side. Asking prices are firm, around 120.00 live and 190.00 dressed, and they could be adjusted if better basis opportunities develop.

Boxed beef traded higher in the morning report with the choice up .29 at 183.29, and the select at 169.93 is .55 higher.

Feeder cattle receipts at the Hub City Livestock Auction at Aberdeen, SD totaled 4217 head. Compared to last week, feeder steers and heifers sold mostly 2.00 higher. It was an active market with good demand. Feeder steers medium and large 1: 494 head averaging 873 pounds traded at 133.25 per hundredweight. 263 heifers weighing 837 brought an average of 129.20.

Barrows and gilts in the Iowa/Minnesota direct trade opened 1.35 higher, the West is up 1.74 with both at 90.29 on a carcass basis, and the East is down .45 at 82.39. Missouri direct base carcass meat price is steady from 82.00 to 85.00. Terminal hog prices are steady in a light test with tops from 60.00 to 61.00.

For the week ending Sep 24, Iowa barrows and gilts averaged 270 pounds, 1.6 pounds heavier than the previous week and .2 pound bigger than 2010. This is the first scale ticket above last year since mid May. Look for weights to keep growing for another 30 to 60 days.

Buffett featured speaker at Purdue Ag Alumni Fish Fry

The 2012 Purdue University Agricultural Alumni Association Fish Fry is scheduled for Saturday, February 4th.  The annual fish fry will be held at the Blue Ribbon Pavilion at the Indiana State Fairgrounds beginning at 11:30am.  The events featured speaker is Howard Buffett, president of the Howard G. Buffett Foundation, a private foundation with the mission of addressing global food security through sustainable agriculture production.

Tickets must be purchased in advance and will be available later this fall.

Vitamin C left unprotected

Anti-caking agents, a food additive often used to protect vitamin C in powdered products may cause more harm than good.  A recent study done by Purdue University faculty found that foods made with powdered vitamin C may lose the vitamins nutrients at a lower humidity level.  Lisa Mauer, a Purdue University professor of food science said  the anti-caking agents act like raincoats protecting particles from moisture, however the research found the moisture repellant agents are mobile and often clump together leaving the vitamin C exposed.  Once moisture reaches the vitamin C, it is destabilized and its nutrient values are lost.

The study’s findings were published in the Journal of Food Science.

Tracking sodium intake is not a national pastime

Do you know how much salt you’re eating?  The International Food Information Council found that Americans are out of touch with how much sodium they’re eating. Almost 60% said – in a recent study – that they don’t pay attention to the amount of sodium in their diet. More than two-thirds say they don’t know how much sodium is recommended. Even among people with high blood pressure, which is linked to high sodium intake, only slightly more than half are aware of the dietary guidelines for sodium.

HEALTHY LIVING PROGRAM – Sodium awareness (1:30 mp3)

Purdue receives bioenergy research funding

Researchers at Purdue University are receiving a $3.8 million federal grant to study the potential of grasses as a bioenergy crop.  The funds are part of a larger $25 million USDA grant to Iowa State University to create production systems to give growers information on how to maximize bioenergy grass growth on marginal farmland.  Sylvie Brouder, Purdue agronomy professor said researches will work to create models so farmers can predict how grass crops could grow on their land.

Demonstration gardens will be developed to help communicate the study’s findings to communities across Indiana.