Just a warning , you better start packin

[Hog's Gone Fishin]

your freezer NOW. When the food supply demand trickles down to the consumer it's gonna hurt. This Goddamn ethanol bullshit is the stupidest thing I've ever seen. Go buy a bag of Tostitos right now and you'll be gettin a bargain if it's only 4 bucks. Hog prices are hittin ALL TIME HIGHS AND PRODUCERS ARE LOSING BIG MONEY !



Pork Commentary: Lean Hogs Hit Life of Contract Highs!!
CANADA - This week's North American Pork Commentary from Jim Long.
Jim Long on ThePigSite

Jim Long is President &
CEO of Genesus Genetics.
Last week’s USDA December Hogs and Pigs Report were definitely interpreted as bullish. Life of contract highs was reached in all the summer months in 2011 with all four months in the 90’s. The formula for stronger prices is many.

Our Observations
The USDA December report showed there was about 70,000 fewer sows, and 500,000 fewer pigs than a year ago. Less is not more!


Global meat consumption is expected to increase 2 per cent in 2011


US cattle futures hit record highs this past week when the lead month peaked at 107.475. Texas cash cattle also hit $1.07 per pound – the highest in seven years. Drivers in the cattle market are strong domestic and export beef sales, optimism China will buy beef and expected fewer cattle in 2011. April live cattle futures closed at $112.20 per pound last Friday up over 20 cents per pound from April future lows. That would be $260 per head higher on a 1300 pound steer. Record beef prices are going to do nothing but enhance hog prices and the lean hog future market pushing higher is a reflection of that reality.


This past week a pork powerhouse leader expressed to us his greatest fear for 2011 – it is not pork demand; the fear is feed price acceleration and the large packer margins that packers have enjoyed since last spring. The just of his premise that packer margins that have reached above $30 per head at times are unhealthy for a robust production base. Especially the last three months when producers were losing $20 per head.
Of note: Pork plant margins for last Thursday, on average, were forecast at $3.90 per head down from $16.70 a week ago, this as hog prices surged in the past week. Over the next while we expect to see an interesting dynamic of lower hog numbers and the dilemma of packers to try to hold margins and or market share.

In our opinion, one of the greatest indicators of market psychology is the USDA cash early wean and feeder pig market. Last week cash early weans averaged $56.75(high $65.00), cash 40 pound feeder pigs averaged $67.77(high $73.00). Very strong prices in the face of $6.00 corn. This is a real indication of lack of supply and strong demand.


High corn prices, soybean and feed prices will only push hog prices higher over the coming months. With North American pork producers as least cost as any in the world, high feed prices will result in a greater market share gain as pork production is further limited in grain importing countries. Countries such as South Korea, Japan, Taiwan, and Mexico will need to have substantially higher hog prices to cover their cost of production significantly higher than North America. The high domestic prices in these countries will continue to pull pork from North America enhancing prices.


In the next while there will be increased interest in improving feed conversions due to high feed costs. There will be ongoing pressure on Genetic companies to show improvement and results. Some Genetics can, some can’t. We are glad that Genesus spent significant money eight years ago to measure individual feed conversions and growth rates. Currently some boars are 2.1 to 1. We all have to become increasingly more efficient.
Summary
Watching NBC national news last week the increasing cost of food and pork was a news item, a National story. Wait until the Einstein’s that have subsidized the insanity of putting billions of bushels of corn into ethanol production begin to see the economic, social, and political implications of higher feed costs. This will become a bigger story in 2011. We suspect that more land will be coming out of set aside while the battle of continued corn ethanol subsidies will be engaged.

The good news for hog producers in 2011 is pork prices will be strong which will support higher feed prices. We expect hogs will reach $1.00 lean this season.


Author: Jim Long, President & CEO, Genesus Genetics

[Raiderhater]

Originally Posted by BigOlChiefsfan

Danged bourbon whiskey sure ain't cheaper

I hear that!

[HonestChieffan]

Blantons is $50 at hyvee. Evan williams single barrel $26. I think Templetons Rye was about $34

[notorious]

Originally Posted by Buehler445

Welp, corn is going to go under $4.20 tomorrow. We survived $7.00 corn without the world ending.

Damn, are farmers going to stop buying 250K pieces of equipment by the shed-full now?


I was worried the prices were going to drop, and a lot of farmers were over-buying equipment to avoid taxes. Hopefully they keep it together.

[Sweet Daddy Hate]

Eh, we'll just raid your farm en-masse.

[Hog's Gone Fishin]

Originally Posted by notorious

Damn, are farmers going to stop buying 250K pieces of equipment by the shed-full now?


I was worried the prices were going to drop, and a lot of farmers were over-buying equipment to avoid taxes. Hopefully they keep it together.

Crop farmers have made a fortune the last 6 years.

[Buehler445]

Originally Posted by mike_b_284

The only places I know that have ethanol free are around lakes (ozarks/pomme) since you shouldn't put it in jetskis/boats/etc. I just fixed a neighbors brand new powerwasher, needed a carburetor because he left gas in it for 6 months. that shit rots so fast it is ridiculous. You would think together the oil and auto industry would/could out lobby the aggies.

It's not the aggies. Washington doesn't give half a **** about the ag industry. What Washington does give a shit about is food prices. And throughout history, we've food as a % of household income as the lowest in the world. Still is that way.

Originally Posted by 'Hamas' Jenkins

Environmentalist whackjobs? What environmentalist would support ethanol? It's the worst possible fuel for the environment.

Liberals love to sell it as "green energy". That's where this whole thing started and has stayed. That's why the subsidies. Washington gives no ****s about ag.

Originally Posted by MOhillbilly

I ain't seen feed prices come down at all.

Really? Hay prices have come down quit a bit here. Silage has always been based on corn prices which are down this year. Processed feed, IDK. Depends on the processor.

Originally Posted by notorious

Damn, are farmers going to stop buying 250K pieces of equipment by the shed-full now?


I was worried the prices were going to drop, and a lot of farmers were over-buying equipment to avoid taxes. Hopefully they keep it together.

We'll see, personally we haven't 179'd anything that we have leveraged. That is death for a cash flow.

Originally Posted by Hog Farmer

Crop farmers have made a fortune the last 6 years.

Margins have certainly been improved with the higher crop prices, but fertility has followed the crop prices up and several herbicides have seen greater than 25% inflation.

And in my part of the world, I haven't grown much of a goddamn thing to sell at the high prices. That and kochia have gotten so ****ing expensive to kill, herbicide is a far higher percentage of total production expense compared to 3-4 years ago, has also had a major effect on my margins. Times have been good for grain farmers but not as much as you may think. Additionally, it had been HORRIBLE for a decade.

[MOhillbilly]

Shit, ain't come down around here. With the late winter and wet spring hay didn't get cut till it was pretty much trash. At least my hay resources were that way.
This shit is unheard of down home. My daddy would die if the sugars went to the seed.
Gotta get them beans in son!

Fall cuttin was better.