Pork, Forages and Feedstuffs Outlook

Curt LacyExtension Economist-Livestock

BARROW AND GILT PRICESIowa - So. Minnesota, Carcass Base Price, Weekly

50

60

70

80

90

100

110$ Per Cwt.

Avg.2005-09

2010

2011

H-P-0909/19/11

Livestock Marketing Information CenterData Source: USDA-AMS, Compiled & Analysis by LMIC

HOG CUTOUT VALUEWeekly

58

68

78

88

98

108

118$ Per Cwt.

Avg.2005-09

2010

2011

H-P-1009/19/11

Livestock Marketing Information CenterData Source: USDA-AMS, Compiled & Analysis by LMIC

No major reductions expected in pork production expected

2009 2010 2011 2012 20130

5000

10000

15000

20000

25000

5814 5607 5720 5735 5709

5490 5302 5371 5398 5468

5700 5401 5446 5385 5548

5996 6126 6204 6352 6451

Q1 Q2 Q3 Q4

Mill

ion

Lbs.

U S NET PORK EXPORTSCarcass Weight, Monthly

150

200

250

300

350

400

450

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC

Mil. Pounds

Avg.2005-09

2010

2011

I-N-3209/09/11Livestock Marketing Information Center

Data Source: USDA-ERS & USDA-FAS, Compiled & Analysis by LMIC

Outlook for 2012

• Continued price strength• Larger supplies• EVEN larger exports• Expect prices and profits to

be very similar to 2011

FORAGES

Fertilizer Prices 1997-2011

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

Feb

2010

Mar

201

1

Sep

2011

$100

$200

$300

$400

$500

$600

$700

$800

$900

$1,000

Nitrogen (AN) Phosphorous (DAP) Potash (Muriate)

$/t

on

Total Direct Expenses$0.00

$50.00

$100.00

$150.00

$200.00

$250.00

Direct Costs for Various Winter Annuals 2011

Stockpiled Bermudagrass Stockpiled Fescue Rye Conv. till - Drill

Ryegrass Conv. till - Drill Rye/ryegrass/arrowleaf Conv. till - Drill Rye/ryegrass/arrowleaf/crimson Conv. till - Drill

$/Ac

re

Other Forage Notes

• Look for another dry winter.

• Tight hay supplies will get tighter.

• Costs of silage and other forages will be higher this winter.

• Dry year last year in major seed production regions decreased supplies of some annual seeds.

FEEDSTUFFS

No Good News Here!

11-Aug 17-Sep 2-Nov 4-Jan 8-Feb 8-Apr 13-Jun Sep 2011

$0.00

$50.00

$100.00

$150.00

$200.00

$250.00

$300.00

$350.00

$400.00

Ground Corn Soy hull pellets Corn gluten pelletsWhole Cottonseed Soybean Meal

04/05 05/06 06/07 07/08 08/09 09/10 10/11 11/120

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

0%

10%

20%

30%

40%

50%

19.8%17.5%

11.6% 12.8% 13.9% 13.1%

5.4% 5.4%

Ending Stocks Production Domestic Use and Exports Stocks:Use

US Corn Supply and Demand

Tight Stocks Since 1995 in Feed Crops Despite Large Crops

Source: Daily Livestock Report

Other Feedstuffs

• Less cottonseed and cottonseed meal = higher prices.

• Higher soybean meal prices.

• Most feed ingredients will be higher in 2011.

Ingredients $/ton $/lb CP $/lb TDN

Bermudagrass Hay, Good $ 100 $ 0.490 $ 0.101

Bermudagrass Hay, Average $ 100 $ 0.588 $ 0.111

Bermudagrass Hay, Poor $ 100 $ 0.980 $ 0.120

Small Grains Pasture - $175/acre $ 11 $ 0.139 $ 0.036

Ann. Ryegrass Pasture - $175/acre $ 8 $ 0.091 $ 0.025

Corn Gluten Feed $ 225 $ 0.500 $ 0.151

Soybean Hulls $ 225 $ 1.042 $ 0.160 50:50 CGF:SH $ 225 $ 0.694 $ 0.156 Whole Cottonseed $ 390 $ 0.867 $ 0.228

Corn $ 325 $ 2.257 $ 0.201

Summary

• Feed and fertilizer prices will be up.• Forage costs will be higher.• Pig prices and profits will be lower.• Next few years will continue to be difficult for

most livestock producers.

Pork, Forages and Feedstuffs Outlook

Curt LacyExtension Economist-Livestock

www.secattleadvisor.com