Thursday, June 09, 2011

Something You Might Not Have Known

... or you might have, in which case you can roll your eyes, sigh and click away.

As corn prices rise, pork prices temporarily fall. That's because pigs are fed with corn and rising feed prices make it more expensive to maintain larger herds. Pig farmers kill off some of their pigs so they can pay their feed bills. The result is a temporary glut of pork on the market until the herds have been reduced to a size the farmers can afford.

Bloomberg's got an article on this phenomena today.
U.S. hog producers may start to cull herds as the faltering economic recovery curbs pork demand and tightening corn inventories boost livestock-feed prices, curbing animal supplies and increasing costs for meatpackers.

Since May 16, wholesale pork has dropped 9.6 percent from the highest since at least October 1997, while corn, the main ingredient in animal feed, gained 9.5 percent. Hog producers are facing record production costs, based on current futures prices, Steve Meyer, the president of Paragon Economics, said yesterday at the World Pork Expo in Des Moines, Iowa.
Just thought I'd share.

1 comment:

Dean said...

I get the economics but... killing food seems almost immoral. It's bacon for cryin' out loud.