Pork prices plummeting
November 30, 1998
There’s no such thing as a free lunch. But free hogs, now that’s a different story.
A pair of Iowa farmers, one in Indianola and another in Baldwin, protested rock-bottom pork prices by giving away pigs this weekend.
Rock-bottom might be an understatement. Last year at this time, farmers could get $46.50 per hundredweight, but this fall, it’s fallen below $15 in some markets.
The damage is easy to see. An ISU animal science professor estimates that farmers are losing $60 on every pig they sell — bad news made even worse by 10-year lows in grain prices.
So consumers are saving money, right?
Sorry, wrong answer. Pork chops still cost $1.79 per pound, according to a local grocery store employee, and according to the Des Moines Register, farmers get less than 30 percent of that amount, down from about 44 percent in the 1980s.
These numbers make it easy to understand why pork producers would be giving their swine away like so many free pencils at the county fair.
Ron Mohr, the Baldwin farmer, said he would rather shoot his hogs. “It’s kind of insulting my intelligence,” he said.
The problem is two-fold, as any beginning economics student can tell us. Low prices are born of an overabundant supply and a lack of demand.
In this case, it is happening partly because meat packers, increasingly, are raising their own hogs.
In-house production allows them to avoid bidding on hogs at market prices. Demand for pork plummets as scores of hogs are left unbought. Soon, supply skyrockets and prices plummet.
The stagnant (to put it mildly) Asian economy has also depressed demand because exports to those countries have fallen with the value of their respective currencies.
We hereby offer this solution: Give the packers a taste of their own medicine.
Call up your local pork producers and buy meat directly from them. They can pick one out of their lot and send it to the butcher.
You can compromise on the price. It will cut dollars from your grocery bill, and the farmer will get a more reasonable price for his pigs.
Hog farmers have gotten a bad name recently, what with manure spills and fish kills. But now, they’re the ones in trouble, and this time, it’s the prices that stink.