More thoughts from Argentina

The swine conference I attended in Mendoza, Argentina was very interesting. I had lunch yesterday with a producer from Chile who’s production records rival the best systems in the US. His challenge – how to source feed ingredients. In addition to attending the swine conference, he was spending several days sourcing corn that he will be feeding in December.

The corn he buys this week must be trucked up to 600 miles to a sea port, loaded on a ship, and then unloaded and truck transported in Chile. The same for his soybean meal (44%). The transport was adding approximately $0.90-$1/bu to his corn expense.

One of the presenters was from Spain and presented cost of production data for Spanish producers. Spain is the second largest pork producing country in Europe. Based on a conversion of $1.28 per Euro, the average cost of production in Spain in 2009 was $136.94 to produce a 230 lb pig. The breakdown was $32.45 to produce a weaned pig, $16.59 to take a weaned pig to 40 lbs and $87.90 for grow-finish gain.

The surprising number in the presentation was the death loss for pigs in all regions of Spain. Nursery mortality averaged 3.4% while grow-finish mortality average 5.15%. It appears that circovirus (PWMS in Europe) is really limiting their production as yet.

The average cost of corn was $4.83/bu, while their 44 soybean meal cost $362/ton (equivalent to $390/t for hipro meal). Feed was 62% of the total cost of production for Spanish producers.

In Argentina, they have a mix of production systems, with many producers still housing pigs outside, while the trend is a move to full confinement. The disease presentations discussed such items as atrophic rhinitis control, mange, APP lesions, etc., diseases that we have pretty well eliminated in our production flows in the US.

As best I can figure out, pork production is extremely profitable right now in Argentina. Long known for its beef production and consumption, consumers are shifting to pork as a lower cost animal protein alternative to expensive beef. Imports of pork are rising rapidly with imports in the first 5 months of this year up 24% versus 2009.

By the way, the pork is very delicious here. Last evening, I attended a banquet with over 400 people from the conference. Our meal was a 16 oz piece of pork shoulder. It was very tender, juicy and something that would be a hit at many American restaurants if they prepared it the same as what we had last night. When combined with the local wines – an outstanding meal.

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