If you are a livestock producer, more specifically a pork producer, the past couple of years have probably been the most challenging in your farming career. I know because I have been there and lived it. My father raised hogs on this farm his entire life, so I was destined to follow his footsteps. Following college, my first sows farrowed in the spring of 1974. These pigs were ready for market by November that year and my first 12 head sold for total of $782.77 or $65.23 a pig. Over the next 25 years we expanded our swine enterprise and used most of the grain we grew to produce pork. Prices at times were great, other times not so great. Like many others we decided to get out of the hog business in 1998. Some of the last hogs we sold that year grossed for less than $50 per head. Did we do anything wrong over those years? I don't think so. Hey, we made it through the 1980's when interest rates were in the teens!
This latest down cycle in pork prices has lasted longer than usual and way longer than any producer was prepared for. Just when we all thought things would get better, H1N1 arrived on the scene causing havoc because the news media deemed to call it "Swine Flu". Export markets were hit hard. Here at this Allendale Branch Office in Thayer County, Nebraska, one of my neighbors is the only person in the county that owns and raises his own hogs. Thirty-five years ago there were more than 100 hog producers in this county.
How times have changed here in Nebraska, swine producers are becoming fewer and fewer in this state, but the number of swine produced here continues to grow and grow. This phenomenon is not only happening in Nebraska, but in other states as well. In 1997 a year before we decided to exit producing pork there were 6,587 hog farms in the state according to the National Agriculture Statistics Service (NASS). By 2007, over 60% of those hog farms were gone and we were left with only 2,482 farms producing hogs. But here is the real kicker! According to NASS, in 1977 the number of pigs sold in Nebraska was 7,671,698 head. By 2007, that number had grown by 42% to 10,880,337 head! Farms in Nebraska with over 5,000 sows are now accounting for 82.8 % of all hogs in the state.
So, are you to blame for what has happened to hog prices? Probably, not! You wouldn't be here today if you were not a good manager. Foreign countries know that the United States is still best provider of high-quality pork products. The problem is that after 17 years of export growth, it looks highly unlikely it will continue this year. These are stressful times and stress can cause you to loose concentration and not make good management decisions. Seeking some help to watch grain markets and locking in feed needs can help. Profitability will come if you stay focused on good management practices. That includes marketing, which Allendale can play a big part.
Rich Mosier
Allendale Branch Manager – Davenport, NE
Toll Free 1.888.439.3636
rmosier@allendale-inc.com
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