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Pork producers squeezed by tight margins
A variety of factors continue to tighten margins for pork producers.
Josh Maschhoff of Nashville, Illinois is a director for the Illinois Pork Producers Association. He tells Brownfield an extended period of high grain prices have not helped.
“Feed costs make up 70% of the cost of production for these protein animals. So, when you couple that with the weaker than normal summer demand that we’re seeing right now, the margins get really tight.”
He says cooler weather has slowed the start of grilling season.
“We don’t see everybody outside on their patio grilling and then you can kind of see some of that domestic demand not coming along. It’s really squeezing these producers to having some negative margins in the time period where they’re not normally expecting to have negative margins.”
And he says packers continue to get a larger portion of the profit.
“The average everyday farmer doesn’t recognize a huge margin. They get a very small percentage of the retail cost that a consumer pays in the supermarket.”
He says inflationary pressure has also increased the price of building materials, limiting expansion and improvement projects on swine operations.
Pork producers and supporters were at the Illinois capitol on Wednesday for the declaration of May 3rd as Illinois Bacon Day. Maschhoff tells Brownfield it was a day to celebrate the 4th largest pork producing state, but also an opportunity to discuss these issues with legislators.
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