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cropsey, il 61731 | I wouldn't say flush with cash after 3 years of significant losses. You can't just shut the farm down and wait for better prices. Debt is being repaid.
What is going away is smaller guys with a vision for running a business. Most of these guys expanded from farrow to finish to sow farm/contract grower businesses and enjoy most of the economies of scale that larger hog operations have, but but can supply a significant amount of feed from their own grain farm operation. They are getting older and in rocky times many are closing down or selling out. The next generation is generally not interested in the responsibility or the work. So, the cargills of the world just expand a little as production goes away. They have the corporate 'vision' running the sows and they find guys (like me, but I'm not w/cargill) to grow the hogs.
my take on it,
Pat
Also, the packing business is far from easy and it's seems it works best when everything is in full production. Often packers will have a number of contract hogs to smooth out the supply swings that occur due to seasonal variation and disease cycles. | |
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Hog Expansion?
