Cooney: Weaner pig breakeven price drops on higher soybean meal

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This market update is a PorkNetwork weekly column reporting trends in weaner pig prices and swine facility availability.  All information contained in this update is for the week ended August 23, 2013.

The weaner pig breakeven price is down $4.82 from last week mainly due to higher soybean meal and lower hog prices. The weaner pig breakeven price is $46.28. The breakeven price is based on closing futures prices on August 23, 2013 and the assumptions outlined below.

Margin over variable costs was $68.11 and refers to the revenue generated from raising a weaner pig that contribute to fixed costs and pig purchase costs. In other words, if the alternative is to idle facilities every dollar between the purchase price and margin over variable costs contributes toward covering those fixed costs such as facility, labor, utilities, property taxes and insurance.

For the Week Ended

8/23/2013

Weekly Change

Weaner pig breakeven

$46.28

($4.27)

Margin over variable costs

$68.11

($4.27)

Pig purchase month

Sept, 2013

Sept, 2013

Live hog sale month

Feb, 2014

Feb, 2014

Lean hog futures

$84.65

($0.42)

Lean hog basis/cwt

($4.82)

($0.41)

Weighted average sbm futures

$417.73

$30.43

Weighted average sbm basis

(5.71)

$0.00

Weighted average corn futures

$4.76

$0.06

Weighted average corn basis

($0.18)

$0.00

Nursery cost/space/yr

$35.00

$0.00

Finisher cost/space/yr

$40.00

$0.00

Other feed cost

$22.50

$0.00

Assumed carcass weight

205

0.00

Note that the weaner pig profitability calculations provide weekly insight into the relative value of pigs based on assumptions that may not be reflective of your individual situation. In addition, these calculations don’t take into account market supply and demand dynamics for weaner pigs and space availability.

National Direct Delivered Feeder Pig Report

Reported cash traded weaner pig volume was 48 percent lower with 23,253 head trading. Reported cash prices were up $0.15 per head from the previous week at $38.02 and the low to high spread was $1.00 narrower.

Cash sale weaner pig volume

23,253

Weighted average cash price/head

$38.02

Cash low price/head

$33.00

Cash high price/head

$41.00

The number of reported weaner pigs sold on a formula basis was down 34 percent with 36,136 head being reported at an average price of $41.13 which is up $0.34 per head from the previous week.

There are 5,400 available spaces listed on ePigflow and 18,400 wanted spaces listed on ePigflow.

Ryan Cooney is general manager of ePigflow, an online market for weaner pigs, feeder pigs and facility spaces. You can find available pigs and facilities by visiting www.epigflow.com.



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