Cooney: Hog prices nudge weaner breakevens higher

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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 Dec. 20, 2013.

Weaned pigs The weaner pig breakeven price is $86.04, up $1.46 for the week due to higher hog prices. The breakeven price is based on closing futures prices on Dec. 20, 2013 and the assumptions outlined below.

Margin over variable costs was $107.87 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

12/20/2013

Weekly Change

Weaner pig breakeven

$86.04

$1.46

Margin over variable costs

$107.87

$1.46

Pig purchase month

Jan, 2014

Jan, 2013

Live hog sale month

Jun, 2014

Jun, 2014

Lean hog futures

$99.20

$1.02

Lean hog basis/cwt

($0.19)

$0.62

Weighted average sbm futures

$436.36

$11.93

Weighted average sbm basis

$2.21

($0.13)

Weighted average corn futures

$4.42

$0.08

Weighted average corn basis

($0.06)

$0.03

Nursery cost/space/yr

35.00

$0.00

Finisher cost/space/yr

40.00

$0.00

Feed costs per head

89.17

$1.73

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

Cash traded weaner pig volume was below average with 32,399 head reported, that’s basically unchanged from the previous week. Cash prices were $83.65 per head, up $2.83 from the previous week.

 



Reported

Weekly change

Cash sale weaner pig volume

32,399

121

Weighted average cash price/head

$83.65

$2.83

Cash low price/head

$73.00

$3.00

Cash high price/head

$89.00

$2.00

The number of reported weaner pigs sold on a formula basis was 43,829 head reported at an average price of $50.17. That’s down $0.50 per head from the previous week.

ePigflow is collecting and reporting facility information. Below is a sample of facility contracts that have been written in the past 12 months.

click image to zoomFacility AgreementsRyan Cooney

 

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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