Cooney: Weaner breakevens significantly 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 October 25, 2013.

The weaner pig breakeven price is $74.23, up $7.86 for the week. The increase is the result of a $4.30 increase in the May hog futures contract for the week. Corn costs were unchanged for the week and soybean meal was up $15.10 per ton. The breakeven price is based on closing futures prices on October 25, 2013 and the assumptions outlined below.

Margin over variable costs was $96.06 and refers to the revenue generated from raising a weaner pig that contributes 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

10/25/2013

Weekly Change

Weaner pig breakeven

$74.23

$7.86

Margin over variable costs

$96.06

$7.86

Pig purchase month

Nov, 2013

Nov, 2013

Live hog sale month

Apr, 2014

Apr, 2014

Lean hog futures

$97.55

$4.30

Lean hog basis/cwt

($5.26)

$0.00

Weighted average sbm futures

$414.70

$9.74

Weighted average sbm basis

$0.04

$5.36

Weighted average corn futures

$4.53

($0.02)

Weighted average corn basis

($0.14)

$0.01

Nursery cost/space/yr

$35.00

$0.00

Finisher cost/space/yr

$40.00

$0.00

Other feed cost

$21.50

$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

Cash traded weaner pig volume was below average with 31,311 head reported, down 44 percent from the previous week. Cash prices were $56.00 per head, up $3.65 from the previous week. 

 

Reported

Weekly change

Cash sale weaner pig volume

31,311

(24,263)

Weighted average cash price/head

$56.00

$2.65

Cash low price/head

$50.00

$2.00

Cash high price/head

$63.00

$7.00

 

 

 

 

The number of reported weaner pigs sold on a formula basis was below average with 40,320 head being reported at an average price of $46.18. That’s up $1.81 per head from 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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