Earlier this week I had a chance to talk with a cull-market sow buyer. So far the consensus of the sow buyers appears to be 35,000 to 40,000 sows have been liquidated due to the drought and associated high feed prices. There are rumors of increased sow liquidation going into the fall and I think they will happen.
If you think about who is/will be selling sows, the traditional producer who grows some/most of their feed grain needs appears to be the most likely to sell. We’re seeing this already with several Hutterite Colonies in South Dakota selling sows in the face of a bad harvest.
I’ve had conversations with several producers/owners who have been offered 1,200-2,500 sow units for purchase. For many of the sellers, the drought and associated high grain prices is the final straw that will drive them out of the pork production business. These are generally well run operations since they managed to survive thru the 1988-1999 down turn and the low prices of 2002-2003 and again in 2007-2008.