Commentary: Wean pig and swine facility insights

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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 May 3, 2013.

Breakeven price for a weaner pig was $32.24 based on closing futures prices on May 3, 2013 and the assumptions outlined below.  This is down $1.75 from last week and down $5.28 from four weeks ago.

Margin over variable costs was $55.04 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.

Weaner Pig Breakeven

$33.24

Margin over Variable Costs

$55.04

Pig Purchase Month

May, 2013

Live Hog Sale Month

November, 2013

Average north central IA SBM Basis

$22.25

Average north central IA Corn Basis

$0.24

Nursery cost/space/yr

$36.00

Finisher cost/space/yr

$42.00

Other Feed & Drug cost

$26.50

Assumed Carcass Weight

205.00

Hog Basis net of Premiums & Freight

$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 reported volume was 57 percent higher this week with 51,430 head trading. Reported cash prices were down $0.70 per head from a week ago at $27.90 and the low to high spread was $10.75.

Cash Sale Weaner Pig Volume

51,430

 

Weighted Average Cash Price/head

$27.90

 

Cash Low Price/head

$22.00

 

Cash High Price/head

$32.75

 

The number of reported weaner pigs sold on a formula basis was down 9 percent with 34,668 head being reported at an average price of $38.12 which is up $0.51 per head from the previous week.

Facility Spaces

As listed on ePigflow, there were 48,800 finishing spaces available and 10,500 nursery spaces available. For total available space of 59,300 on a combined basis which is up 21 percent compared to the previous week.

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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