Profitable Use of Ractopamine in Hog Production – Economic Evaluation Using a Pig Growth Model

Posted in: Economics by admin on January 1, 2002 | No Comments

Recently, a pig growth model has been developed, that incorporates the impact of RAC on pig compositional growth and nutritional requirements. The objective of this research was to utilize the compositional pig growth model to evaluate the economically optimal use of RAC with different marketing systems. The study confirms that under present economic conditions, the feeding of RAC is profitable to pork producers. The highest return from the use of RAC will accrue to producers with a better growth environment and those using a 3-diet, phase-feeding program after 154 lbs live weight.
Part of the additional profit due to the use of RAC comes from faster growth rate and less days on feed. As the payment for leanness increases, the return to RAC use also increases.
Greater payment for lean versus fat tissue results in higher optimal RAC concentrations being fed
for longer durations, given the same economic conditions.

Effects of Marketing Decisions on Net Present Value of Pork Production for Independent and Allied Swine Producers

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For the target-weight scenario, net present value is maximized when the target weight
reaches about 270 pounds, holding other variables constant (figure 3). Also, model
simulation suggests that if producers grow genetically improved feeder pigs and
if the purchase premium is appropriate, NPV improves to a value between $6,000
and $8,400. For example, this happens with a 0.1-pound increase in ADG and a
premium of $1.00 per head for 260 pounds to 280 pounds target-weight scenarios.
The pricing matrix we used penalizes a pig heavier than 280 pounds. The
model indicates that targeting about 270 pounds market weight is optimal and
producing pigs heavier than 280 pounds is not advised; thus, our model closely
emulates the current market situation. The pricing matrix signals producers to
decrease the proportion of pigs heavier than 280 pounds. Our model advises a
compliant target weight. Thus, independent finishers have incentive to market
pigs just past the midpoint of the “sweet zone” of the pricing matrix (the range
of weights where pigs are not penalized for being too light or too heavy).
For allied farmers with a fixed shipment schedule, it is also more profitable to
ship heavier pigs than the 1995 to 1998 average. Extending all shipping schedules
by an additional eight days (a longer production period results in heavier pigs
shipped) maximizes NPV (figure 4). In this case, pigs will be on feed for 120,131,

Economic impact of a ban on the use of over the counter antibioticsin U.S. swine rations

Posted in: Economics by admin on January 1, 2001 | No Comments

A Markov Chain Analysis of the Size of Hog Production Firms in the United States

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The objective of this article is to estimate, using Markov chain analysis, the relative
importance of input and output prices and other factors in the determination of the size
distribution of hog operations in the United States in recent years. The following section
briefly reviews the literature on Markov Chain analysis as it applies to agricultural subsectors. Then, a model is presented for estimation. Empirical results are presented in the
fourth section. The final section of the paper contains conclusions and implications.

Evaluating Economic and Fiscal Impacts of an Evolving Swine Industry

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This article reports on a study supported by CURA and the Minnesota Pork Producers Association that investigated the regional economic and fiscal impacts of the Minnesota pork production industrya

Meat Packer Vertical Integration And Contract Linkages in the Beef and Pork Industries: An Economic Perspective

Posted in: Economics by admin on January 1, 2000 | No Comments

This report describes and analyzes the current vertical integration, producer-processor or first handler contract and
cash market linkages in agriculture, emphasizing the beef, pork, and poultry producer and processor vertical market structures, and how they compare to the vertical linkages in other important agricultural commodity systems; Driving forces for the changes observed in the food and agriculture market structure, and the economic incentives for tighter vertical coordination linkages in the beef, pork, and poultry industries; Benefits and costs of these coordination system changes in agriculture, emphasizing those in the beef, pork, and poultry industries for processors and merchandisers, independent and contract producers, other industry participants, and consumers; and Implications of packer vertical integration or contract linkages with cattle and hog producers for independent and contract livestock producers, packers, other industry participants, consumers, global market competitiveness, price discovery and reporting, policy makers, and regulators. The results indicate that the consumers of beef and pork are willing to pay an additional 20 to 30 cents per pound for meat from a system of production that results in a branded, customized
product. The results also suggest that this premium will grow over the next five years. Evident, too, from the results is the value consumers place on food safety and the ability to trace product to the point of origin. A potential market for attractively packaged products is also suggested here. The results also indicate that a group of consumers is willing to pay more for products from hormone-free and other animal- friendly environments. This added value to beef and pork products cannot be captured without innovative vertical linkages throughout the beef and pork production, processing, and merchandising system. That perceived value, as it increases in the future, serves as an increasingly important driving force in the industry reorganization which is now underway and very likely to continue.

Reducing Losses from Farm Gate to Packer

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There are a number of very obvious sources of economic loss attributed to the period from the time a producer groups his pigs for shipping until slaughter. Pig deaths, loss in carcass weight, pale, soft and exudative (PSE) or dark firm and dry (DFD) pork, and physical injury / bruising. Some pig stressors are facility designs, environment, physical abuse, stocking density, and mixing. It was found in this study that the economic impact of pig transit and lairage deaths, bruising, lost carcass yield and PSE/DFD pork can be minimized, firstly, by refraining from the use of stress susceptible pigs and, secondly, by limiting the amount and impact of stress during the 24 hours prior to slaughter. The impact of pre-slaughter stress can be limited by careful consideration of: Facility design (pens, chutes, ramps, flooring, gates, transport vehicles); pig environment (temperature, humidity, lighting, smells, sounds);
humane handling practices, as well as conditioning pigs to handling; stocking density; mixing of unfamiliar pigs; Total time of feed/water withdrawal during transport and lairage; Rest in lairage after transport; this requires that all of those who handle and/or transport pigs during the period from the farm to slaughter adhere to these principles.

Economic values for meat quality traits in pigs

Posted in: Economics by admin on January 1, 1999 | No Comments

The objectives for the research reported here were to
collect information on possible future developments of
the pork market and to estimate economic values based
on this information. These economic values for meat
quality traits could then be used in the aggregate genotype
of the Swiss pig breeding program to replace the
currently used weights determined by desired gains. It was found that the economic values for meat quality traits using results from interviews can be estimated. This may allow one to incorporate possible future development
of the pork market into a breeding program to develop an aggregate genotype. For pig breeders, this means that the definition of the breeding objective reflects possible future developments of the pork market using systematically gathered market information. Through the process of such surveys, the pork industry has a possibility to express its economic preferences for traits that cannot yet be measured on the slaughter chain and, therefore, are not yet included in the payment system.

Opportunities in Coordinated Hog Production

Posted in: Economics by admin on January 1, 1997 | No Comments

The rapidly changing pork industry is providing new opportunities in coordinated production. Producers should examine the goals of coordinated systems to see if they match the objectives of their operations. Much of the current activity in the industry is attempting to find better ways to link all stages of pork production to provide the highest quality pork relative to costs. Many programs and alternatives exist for producers to consider.

Simulation of the economic impact of proliferative enteritis on pig production in Australia

Posted in: Economics by admin on January 1, 1996 | No Comments