Hog profit picture darkens from earlier expectations

Continued high feed prices and higher hog slaughter levels have darkened the 2012 profit picture for pork producers.

Purdue University ag economist Chris Hurt says high retail pork prices, which have hindered the movement of pork through the retail sector, have also contributed to the diminished profit outlook.

Central City, Nebraska pork producer Mark McHargue, who sells about half of his pigs and finishes the rest, says it has been a disappointing spring.

“It’s not real fun right now—hogs have really come of their highs dramatically—and grain prices have been bouncing around,” says McHargue. “So the little pigs that we’re selling right now, we’re selling at a pretty substantial loss.”

McHargue says pork producers are being very cautious. “We’re not getting that summer high that we are looking for—and so we’re definitely in a loss period in the industry right now.”

Purdue’s Hurt is now predicting a loss of around five dollars per hog this spring and summer, and losses of three to four dollars per head in the fourth quarter.

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