High costs, low prices worry pork producers

Food & Drink Weekly, Jan 28, 2008

High costs, low prices worry pork producers: Rising costs for feed and lower prices for hogs are creating a classic squeeze on hog producers' bottom lines. Iowa hog producers suffered average losses of more than $25 for each hog sold in November and December, according to Iowa State University's estimated livestock returns.

The cost of producing a 270-pound market hog is up 12.3 percent compared with a year ago, according to ISU's estimated returns. Meanwhile, prices paid for the same 270-pound market hog have dropped 19 percent during the past year, mostly because of an increase in hogs brought about by the string of profitable months. Most analysts say this year holds more red ink for hog producers after a record 35 consecutive months of profits ended a year ago.