|
About This Newsletter
|
Send Comments & Questions To
Dale Miller, Editor,
National Hog Farmer
To unsubscribe from this newsletter go to: Unsubscribe
To subscribe to this newsletter, go to: Subscribe
|
|
Market Preview
Cold Storage Trending
Up
USDA’s monthly cold storage report, released yesterday
(May 21), showed a slight reduction in April 30 frozen pork inventories
from their record level of March 31. Total pork in commercial
warehouses amounted to 652.2 million pounds, fractionally lower than
last month’s 652.7 million pounds (see Figure 1). This level is still
the second highest on record.
The increase was led on a percentage basis by stocks of butts, which
grew by 158% vs. April 2007. The actual increase in butt inventories
amounted to 16.937 million pounds, putting butts third on the actual
tonnage increase list for this month. The 27.7 million pounds of butts
in cold storage is a new record, breaking the old mark set two months
ago. Note that butt inventories had never exceeded 20 million pounds
until January 2008 and they have done so each month since.
The largest tonnage increase for April cold storage stocks was bellies
at 38.58 million pounds. Those stocks now stand 62% larger than one
year ago. Ham inventories increased by 30.6 million pounds or 38.5%
over last April.
I think at least a portion of the increases in inventories of these
three cuts is attributable to the refrigerated shipping container
shortage, which we have discussed in the past. While many think the
U.S. pork industry primarily exports loins and tenderloins, these three
cuts have become much more important in the export mix in recent years
– especially as more price-sensitive markets, such as Mexico and
China/Honk Kong, – have grown. Any difficulties for exports in
general will show up in these inventory numbers.
Loin inventories grew by 23%, year/year, or 8.75 million pounds in
April.
I am still not overly concerned about the levels of cold storage
inventories. As can be seen in Figure 2, cold storage stocks as a
percentage of production dropped in April, indicating that March was
very likely the high for the year. If that’s the case, this year’s
peak will be lower than in six of the past 10 years.
Meat Inventories Plentiful
Demand has been, by all accounts, exceptional this spring. If that
continues, these stocks will not pose a problem for the U.S. pork
industry. On the other hand, one must remain concerned about the sheer
volume of product that is in warehouses. Should any hiccup develop for
pork demand – either at home or abroad – these supplies would become
burdensome to prices very quickly.
That concern increases when one considers the amount of total meat and
poultry in cold storage (Figure 3). April’s level of 2.354 billion
pounds is just 10 million pounds shy of the April record set back in
2002. Turkey stocks will continue to grow through next fall, so it will
take some pretty dramatic reductions in either chicken or pork stocks or
both to keep from surpassing the 2002 record levels the rest of this
year.
And current levels of output do not portend well for large reductions of
frozen inventories. Figure 4 shows the amount of combined weekly meat
and poultry production increase over last year. I have used a six-week
moving average to smooth the data a bit, but the message is clear: We
are producing a huge amount of meat protein each week.
Corn Concerns Grow
Finally, the situation with this year’s corn crop does not look good
at all. Figures 5 and 6 show data as of last Monday for the percent of
corn acres planted and percent emerged. The planting rate is the second
lowest since 1990 – barely ahead of the flood year of 1993, while the
percent of corn emerged is far and away the lowest since 1999 (the first
“emergence” data that I could find in the USDA database). Hopes for
more than the planned 86 million acres of corn are now, I think, long
gone and the hope for at least a trend-line yield of 153 or so bushels
per acre is in dire jeopardy.
Consider the likely consequences of 86 million acres and
lower-than-needed yields, plus crude oil surpassing $130/barrel this
week. What does that mean for corn prices if gasoline and ethanol
follow the oil market? Will there be any reason to run ethanol plants
below their capacities?
This is not a good situation for the meat business. But you’ve heard
that before, right?
Click to view graphs.
Steve R. Meyer, Ph.D.
Paragon Economics, Inc.
e-mail: steve@paragoneconomics.com
Introducing the new PIC Camborough® Family
You asked for greater lifetime reproductive performance and longevity.
You asked for more pounds of pork marketed per sow. You asked for a
higher percentage of market pigs in the full-value pay box.
Take another look at our new Camborough family, we think you will like
what you see--after all, it is just what you asked for.
www.pic.com/usa
Production Preview
Management’s
Impact on Variation
The primary focus of the April
15, 2008 Blueprint edition of National Hog Farmer focused on
variation. The articles considered descriptions of variation for pig
populations, sources and costs. We will use today’s space to further
this discussion.
While it is relatively easy to appreciate that there is normal variation
among pigs in a group due to variation in genetics and litter size, it
can be just as easy to overlook the variation that our production
practices introduce into these groups.
Production systems are designed to produce a given quantity of a given
product for specific phases at discrete intervals. And it is in this
discrete interval that we first introduce variation.
The week is probably the most common time interval used in production.
For example, the weekly breeding target of the sow herd implies that all
matings achieved in the week are equal. However, in addition to
differences among the types of animals bred (i.e., first-service gilts,
prime wean sows, repeat breeders), there are also differences in
gestation lengths and the weeks in which sows will farrow, since breed
and farrow weeks are not equivalent.
As piglets are weaned, we assign them to groups according to quantity.
If there are more pigs than the system is designed for, wean age might
be changed, group size might be increased or fill time shortened.
Alternatively, if the system is short on pigs, wean age might be
changed, group size might be lessened or fill time extended. In either
scenario, the age distribution (i.e., age range) of piglets within a
group varies from the expected average. Yet, protocols for rearing
these different groups rarely take such variation into account. Our
feed budgets may be designed for the average pig, yet the “average
pig” may not be represented in the group.
If we start to consider all of the potential sources of variation in pig
production, the prospect of its reduction seems daunting. However, if
we can begin to understand how our management contributes to variation,
we can begin to reduce it and develop programs to mitigate its effects
through the nursery and grow-finish phases.
Stephanie Rutten-Ramos, DVM
University of Minnesota
rutt0011@umn.edu
Editor’s Note: For all your agricultural news, markets and
commentaries, go to www.farms.com.
Ileitis immunity is as easy as turning on the water.
Enterisol® Ileitis keeps immunity on tap.
Call Boehringer Ingelheim at 1-800-325-9167
Legislative Preview
Bush Vetoes Farm Bill
President George W. Bush followed through on his threat
and vetoed the 2008 farm bill. The president in his veto message said,
“For a year and a half, I have consistently asked that the Congress
pass a good farm bill that I can sign. Regrettably, the Congress has
failed to do so.” He added, “At a time when net farm income is
projected to increase by more than $28 billion in one year, the American
taxpayer should not be forced to subsidize that group of farmers who
have adjusted gross incomes of up to $1.5 million. When commodity
prices are at record highs, it is irresponsible to increase government
subsidy rates for 15 crops, subsidize additional crops and provide
payments that further distort markets. Instead of better targeting farm
programs, this bill eliminates the existing payment limit on marketing
loan subsidies.” This is the first time that a comprehensive farm
bill has been vetoed since President Dwight D. Eisenhower vetoed a farm
bill in 1956.
Congress Overrides Veto, But Has to Vote Again — The House of
Representatives overrode the president’s farm bill veto by a vote of
316-108; the Senate overrode it by a vote of 82-13. However, the bill
was missing the trade title. It was discovered that the farm bill the
president vetoed was missing the trade title because of a clerical
error. Thus, the House and Senate leadership have been working on
getting the trade title enacted. The House of Representatives on
Thursday passed the farm bill again with all titles included. The
Senate will consider the legislation after the Memorial Day recess.
Over 1,000 Groups Urged Override — Over 1,000 agriculture,
conservation, nutrition, hunger and environmental groups sent a letter
to every Senator and Congressmen strongly urging them to override the
president’s veto. The letter said, “Communities across the nation,
from urban to rural, have waited too long for this legislation. The
conference report makes significant farm policy reforms, protects the
safety net for all of America’s food producers, addresses important
infrastructure needs for specialty crops, increases funding to feed our
nation’s poor and enhances support for important conservation
initiatives.”
USDA to Ban Downer Cattle — Secretary of Agriculture Ed
Schafer announced that USDA would propose a regulation that would ban
disabled or nonambulatory cattle from entering the food supply. This
closes a loophole that allows downer cattle to be slaughtered for food,
if they go down after a preliminary inspection and are approved by a
USDA veterinarian. Earlier this week, Senate Majority Whip Dick Durbin
(D-IL) had written USDA urging the department to amend its rule to
ensure that non-ambulatory cattle do not enter the food supply. Durbin
referenced the petition by the American Meat Institute, National Meat
Association and National Milk Producer Federation requesting the
loophole by closed. The recent abuses at the Westland/Hallmark meat
plant in California highlighted the need for a change in policy.
Mandatory Price Reporting — USDA has finalized a rule to
implement the 2006 mandatory livestock price reporting legislation. The
rule will take effect on July 15. According to the National Pork
Producers Council, the rule expands the areas for pork, with more sows
to be included in price reports to more accurately reflect the sales and
prices paid in the sow market, changes in the timing for data reporting,
and USDA may publish price distributions for net prices to provide more
information that is more reflective of market situations. NPPC said,
“During this time of economic crisis for many pork producers, having
mandatory price reporting helps producers make business and production
decisions that will allow them to get the best price for their hogs.”
Packers have been voluntarily reporting livestock prices since the
original law expired in 2005. The final rule is available at http://federalregister.gov/page2.aspx#top.
Ethanol Not to Blame for Increased Food Prices — Secretary of
Agriculture Ed Schafer defended ethanol against claims that it is
playing a major role in increasing domestic and international food
prices. He indicated that other factors, such as higher energy costs,
increased worldwide demand for food, and drought in Australia and other
parts of the world have had a greater effect on food prices. According
to the President’s Council of Economic Advisors, “Only 3% of the
more than 40% increase we have seen in world food prices this year is
due to the increased demand on corn for ethanol.” Schafer said, “We
are going to make the case for food and fuel.” Concerning proposals
to modify the Renewable Fuels Standard (RFS), Secretary Schafer said it
would be wrong to roll back the mandate and “changing the RFS is not
going to change the amount of corn that is being used for ethanol.”
RFS Waiver Open for Public Comments — The U.S. Environmental
Protection Agency (EPA) issued a notice for public comment on the
request by Texas Governor Rick Perry for a waiver of 50% of the
Renewable Fuel Standard (RFS) in 2008. EPA is asking for comments to
help EPA determine “if the statutory basis for a waiver of the
national RFS requirements has been met and, if so, the extent to which
EPA should exercise its discretion to grant a waiver.” Also, EPA is
requesting comments on:
- Whether compliance with the RFS is causing severe harm to the
economy of the State of Texas;
- Whether the relief requested will remedy the harm;
- Determinations to what extent, if any, a waiver approval would
change demand for ethanol and affect corn or feed prices; and
- EPA is asking that commentators include data or specific examples
in support of their comments. Also, they are looking for data that
shows a quantitative link between the use of corn for ethanol and corn
prices, and on the impact of the RFS mandate on the amount of ethanol
produced would be especially helpful. There will be a 30-day comment
period after the notice is published in the Federal Register. For more
information: www.epa.gov/otaq/renewablefuels/rfs-texas-notice.pdf.
P. Scott Shearer
Vice President
Bockorny Group
Washington, D.C.
Make ileitis disappear?
Denagard® (tiamulin) 10 is approved to control ileitis in as little
as 10 days. And with its small dosage – 35 grams tiamulin/ton – and
less medication time, no other feed medication is as cost-effective for
controlling ileitis.
Click
on the Denagard logo to learn more.
Pork Industry Calendar
June 22-29, 2008:
Advanced Swine Production Technology Course, University of
Illinois Campus, Urbana, IL; contact: Gilbert Hollis, professor
emeritus, Department of Animal Sciences, phone (217) 265-9191, e-mail hollisg@uiuc.edu or go to http://www.livestocktrail.uiuc.edu/porknet/eventDisplay.cfm?ContentlD=9812.
June 22-25, 2008: 20th annual
International Pig Veterinary Society Congress, Durban, South Africa;
contact: www.ipvs2008.org.za.
Click
here to get National Hog Farmer's complete pork
industry calendar.
 Hermitage NGT
Hermitage NGT offers their North American clients:
- Breeding Stock (GGP/GP/Parent stock)
- Semen-fresh & frozen
- Closed herd breeding programs
- Genetic monitoring through the Hermitage BLUP recording system
Talk with our team of specialists in genetics, reproductive physiology,
nutrition, veterinary medicine, pig production management and A.I. to
design a program to allow you to take advantage of these exciting
genetics.
www.hermitagengt.com
|
|
You are subscribed to this newsletter as #email#
To get this newsletter in a different format (Text or HTML),
or to change your e-mail address, please visit your profile
page to change your delivery preferences.
For questions concerning delivery of this newsletter, please contact our
Customer Service Department at:
National Hog Farmer
A Penton Media publication
US Toll Free: 866-505-7173
International: 847-763-9504
Email:nationalhogfarmer@pbinews.com
Penton Media | 249 W. 17th Street | New York, NY 10011
Copyright 2008, Penton Media. All rights reserved. This article is
protected
by United States copyright and other intellectual property laws and may
not be reproduced, rewritten, distributed, re-disseminated, transmitted,
displayed, published or broadcast, directly or indirectly, in any medium
without the prior written permission of Penton Media.
|
|
