Transcript Slide 1

Meat Animal Outlook
2010/2011
Big Issues:
1. Adjustment to Economic Shocks
2. Exports as the Growth Market
3. Acceptance of Animal Agriculture???
4. What Corn price Means to Pork Industry
5. Biofuels: Food/Fuel Conflict
Department of Agricultural Economics
Purdue University
Department of Agricultural Economics
Purdue University
BioFuels Production
Department of Agricultural Economics
Purdue University
The Economy
Department of Agricultural Economics
Purdue University
Department of Agricultural Economics
Purdue University
Department of Agricultural Economics
Purdue University
Department of Agricultural Economics
Purdue University
Department of Agricultural Economics
Purdue University
Department of Agricultural Economics
Purdue University
Costs and Price Per Head: Purdue
Estimates
05
06
07
08
09
10*
11*
Corn $/bu.bu.
$1.97
$2.28
$3.39
$4.78
$3.75
$3.99
$5.05
S.Meal $/ton
$188
$176
$231
$331
$347
$298
$328
$89.35
$87.25 $83.59
$78.33
Feed Costs $/head
$43.18
$43.06 $42.65
Total Costs $/head
$93.27
$98.37 $117.00 $146.05 $135.77 $133.97 $147.51
Value $/head
Profit-Loss $/head
Breakeven Corn
Px/Bu.
$132.63 $125.24 $124.78 $129.15 $111.34 $148.67 $152.27
$39.36
$26.87
$7.78 -$16.89 -$24.43 $14.70
$4.99
$4.34 $3.99
$3.51
$1.90 $5.10
$4.76
$5.41
*Remainder of 2010 and 2011 are Purdue Estimates
Department of Agricultural Economics
Purdue University
Sows Successful Farming
Smithfields
Triumph
Seaboard
Iowa Select
Pipestone
Mashhoff's
Prestage
cargill
Carthage Sys
AVMC
Maxwells
Large 11
2008
1,020,000
396,000
213,600
160,000
143,600
130,000
140,000
116,000
90,250
82,000
73,000
2,564,450
2009
922,251
371,500
213,600
152,500
132,000
130,000
125,000
116,000
85,000
77,000
69,000
2,393,851
Change
-97,749
-24,500
0
-7,500
-11,600
0
-15,000
0
-5,250
-5,000
-4,000
-170,599
Largest 25
3,135,150
2,934,251
-200,899
USDA: Sept
U.S Breeding
2009
5,968,000
2010
5,788,000
-180,000
Department of Agricultural Economics
Purdue University
2009
2010
Change
1,020,000
1,010,000
-10,000
N. Carolina
990,000
880,000
-110,000
Minnesota
580,000
550,000
-30,000
Illinois
480,000
490,000
10,000
Oklahoma
400,000
410,000
10,000
Nebraska
390000
370000
-20,000
Missouri
345,000
350,000
5,000
Indiana
270,000
290,000
20,000
Kansas
170,000
185,000
15,000
Ohio
170,000
165,000
-5,000
U.S.
5,968,000
5,788,000
-180,000
Iowa
Department of Agricultural Economics
Purdue University
BioFuels Production
Department of Agricultural Economics
Purdue University
Renewable Fuel Standard Billion Gallons
YEAR
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
Conventional
Biofuels:
Corn
4.00
4.70
9.00
10.50
12.00
12.60
13.20
13.80
14.40
15.00
15.00
15.00
15.00
15.00
15.00
15.00
15.00
Advanced
Biofuels
0.60
0.95
1.35
2.00
2.75
3.75
5.50
7.25
9.00
11.00
13.00
15.00
18.00
21.00
Celulosic
Advanced
0.10
0.25
0.50
1.00
1.75
3.00
4.25
5.50
7.00
8.50
10.50
13.50
16.00
NonBiomassTotal
celulosic
based Renewable
Advanced Diesel
Fuel
Standard
4.00
4.70
9.00
0.10
0.50 11.10
0.20
0.65 12.95
0.30
0.80 13.95
0.50
1.00 15.20
0.75
1.00 16.55
1.00
1.00 18.15
1.50
1.00 20.50
2.00
1.00 22.25
2.50
1.00 24.00
3.00
1.00 26.00
3.50
1.00 28.00
3.50
1.00 30.00
3.50
1.00 33.00
4.00
1.00 36.00
Department of Agricultural Economics
Purdue University
Department of Agricultural Economics
Purdue University
How much can ethanol industry pay for 2010/11 corn?
RBOB Gasoline = $2.24/gallon over the 2010/11 corn marketing year
Plus $.36 per gallon blenders tax credit
Equals $2.60/ gallon ethanol
Breakeven corn price is about
$7.25/bushel
RFS Mandate says blenders must buy 12.6 billion gallons in 2011
Ethanol industry cannot produce less by law
Ethanol industry cannot use less corn by law
Department of Agricultural Economics
Purdue University
Table 1. Top 30 US Pork Production Companies
Rank NAME OF OPERATION
1
Smithfield Foods
922,251
Est Market
Pigs
18,445,020
2
3
4
5
6
7
Seaboard Foods
Christensen Farms
Iowa Select Farms
The Pipestone System
The Maschhoffs
Prestage Farms
213,600
162,500
152,500
132,000
130,000
125,000
4,272,000
3,250,000
3,050,000
2,640,000
2,600,000
2,500,000
Mkt Cummulative Packers
Share Mkt Share
17.6%
Smithfield, Farmland,
17.6%
John Morrell
4.1%
21.6%
Seaboard
3.1%
24.7%
Triumph, JBS Swift
2.9%
27.6%
JBS Swift
2.5%
30.1%
JBS Swift, Tyson
2.5%
32.6%
Cargill, Hormel
Smithfield,
Farmland,
2.4%
35.0%
John Morrell, JBS Swift
8
Cargill
116,000
2,320,000
2.2%
9
10
11
12
Carthage System
AMVC Management
Hanor
Maxwell Foods
(Goldsboro)
Hormel Foods (M2P2)
PST Progressive Swine
Technologies
Tyson Foods
New Fashion Pork
Country View Family
Farms
Nebraska Pork Partners
85,000
82,000
80,000
69,000
1,700,000
1,640,000
1,600,000
1,380,000
1.6%
1.6%
1.5%
1.3%
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
Wakefield
Holden Farms
Texas Farms
TriOak Foods
Schwartz Farms
M2P2
Swine Graphics
Hog Slat (TDM)
Garland Farm Supply
Eichelberger Farms
JC (Carolina) Howard
Hitch Pork
Total
SOWS
54,000
53,200
1,080,000
1,064,000
1.0%
1.0%
52,000
48,000
46,500
1,040,000
960,000
930,000
1.0%
0.9%
0.9%
44,500
890,000
0.8%
40,500
810,000
40,000
800,000
40,000
800,000
35,000
700,000
30,000
600,000
27,400
548,000
24,100
482,000
23,000
460,000
23,000
460,000
23,000
460,000
22,000
440,000
15,000
300,000
2,951,051 59,021,020
0.8%
0.8%
0.8%
0.7%
0.6%
0.5%
0.5%
0.4%
0.4%
0.4%
0.4%
0.3%
55.4%
States
IA, MO, AK, OK, MN
IL, IA, IN, MO
IA, MN, SD, NE
IL, WI, OK, TX, NC
43.2%
44.3%
Cargill
Cargill, Triumph
Hormel, Tyson
Triumph, Seaboard
Smithfield, Indiana
Packers
Hormel
45.3%
46.3%
47.2%
Tyson
Tyson
Triumph
NE, IA
AK, OK, MO, IN
MN, SD, IA
48.1%
Hatfield
PA, OH, IN
48.9%
49.7%
50.4%
51.2%
51.9%
52.4%
53.0%
53.4%
53.9%
54.3%
54.7%
55.2%
55.4%
Smithfield (Farmland)
JBS Swift
Tyson
Tyson
Cargill
JBS Swift
Hormel
Tyson
Indiana Packers
Smithfield
Triumph
Smithfield
Seaboard
NE, IA
MN
MN
TX, IA
IA, IL
MN
IA, CO, OK, NC
IA
NC, IN
NC, SC, KS, IA
IA
NC
OK
37.2%
38.8%
40.4%
41.9%
NC, VA, IA, MO, OK,
TX, CO, UT
OK, TX, KS, CO
MN, SD, NE, IA
IA, MN
Table 3: Top 10 US Pork Packers and Processors
NAME OF
Plants
Annual
OPERATION
Harvest
1
Smithfield Foods
9
30,942,000
Mkt Share
29%
2
Tyson Foods
6
18,798,000
18%
3
JBS Swift
3
11,960,000
11%
IL, IA, IN, MO
4
Cargill Meat Solutions
2
9,360,000
9%
NC, MS, IA
5
Hormel
3
9,568,000
9%
6
Seaboard
1
4,100,000
4%
7
Triumph Foods
1
4,100,000
4%
8
Indiana Packers
1
3,900,000
4%
9
Hatfield Quality Meats
1
2,600,000
2%
Routh Packing
1
900,000
1%
28
96,228,000
92%
NC, IN
AZ, IA, MN
10
Total
Department of Agricultural Economics
Purdue University
Department of Agricultural Economics
Purdue University
Bacon accounts for nearly
half of all pork items on menus
Distribution of menued pork items at same operators
Pepperon
i
Breakfast Sausage 8.2%
Sausage
7%
Ribs
2.3
%
Ham (Sliced, Unsliced)
19.2%
12.9%
Pork Chops, Loins, Tenders
4.1%
Bacon
46.2%
19
Source: MenuMine 2005
Department of Agricultural Economics
Purdue University
Department of Agricultural Economics
Purdue University