Pig weights and corn crop

This week I’m on the road once again, doing a series of grower meetings for a production system. The good news – both owners and growers are excited once again to be in the pig production business. It has been a remarkable summer both for live hog prices and consumer’s willingness to purchase pork at higher retail prices.

The shining star this summer has been bacon. If you’ve been following TV ads, Kentucky Fried Chicken has introduced a chicken sandwich with 2 pieces of bacon! Who would have thought the day would come that poultry would add bacon to their product to improve their consumer acceptance! We really do have a product with remarkable consumer appeal.

On Friday, USDA will release their first estimate of the US corn and soybean crop based on actual field samples. Who could have imagined the day would come that a change in US estimated yield of 1 or 2 bu/acre would result in a major market change, either up or down.

While ethanol production now consumers 25+% of the US crop, livestock is still the number 1 consumer of our feed grains. This past year, consumption of corn has been higher than most anticipated, one of the reasons USDA has been lowering its carryout estimate and corn prices have been rising.

One major cause of the higher consumption is the relative poor quality of last year’s corn. In the eastern cornbelt, high vomitoxin has meant producers have been trying to limit the amount of contaminated corn in swine diets – often with varying success. In the western cornbelt, while there are limited reports of severe vomitoxin contamination, the overall quality has been a frustration. As the summer has progressed, it has become clear to nutritionists and pig owners that the available energy in the 2009 corn crop is lower.

Some have estimated a net reduction in energy compared to ‘book’ values of up to 6%. This means feed conversion per pound of corn fed has been higher. I’ve seen many closeouts that are running 0.15-0.25 units higher. When corrected for the estimated poorer energy in the 2009 crop, feed conversions are running very consistent with those from 2009, when pigs were fed corn from the 2008 crop year.

The market surprise this summer is how well sale weights have been maintained, even with poor quality feed ingredients. This suggests that pig owners have found sufficient barn spaces to hold pigs a few more days/weeks to maintain sale weight. This also means that we don’t have an abundance of barns sitting idle. Based on my conversations with production systems and my phone calls, I would have to agree with that conclusion. We have kept pigs in barns for more days in order to maintain sale weights, which means we most likely have a slightly larger inventory of pigs in the kept for market category than would be expected based on Canadian imports and our sow inventory.

Unknown in this inventory question is what will happen in the next month as we grow pigs in cooler weather and they gain access to 2010 corn. How fast will pigs grow in the coming month(s) versus early August, and how fast will sale weights climb as producers play catch up on sale weights?

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