A soaring demand for corn used to produce ethanol has hog farmers bracing for higher feed prices that threaten to put some producers out of business.
The price of corn is expected to climb to $4 a bushel, a level not seen in the last decade. The soaring price was the subject of a seminar Thursday at the Iowa Pork Congress, a two-day annual gathering for Midwest hog farmers.
"Right now (pork producers) are operating in the red," said Carol Stevens of Fordyce, Neb. "There's no profit in livestock now because of the cost of grain."
Neil Dierks, chief executive officer of National Pork Producers Council in Des Moines, agreed that many producers are struggling.
"Right now most hog farmers are in the break-even range," Dierks said in a phone interview.
Dierks said some producers will opt to quit the business.
Jerry Shurson, a professor who studies swine nutrition and management at the University of Minnesota, said the situation could ease as more farmers rely more on an ethanol-production byproduct called distillers grains as animal feed. Most farmers already feed their hogs between 10 to 20 percent of distillers grains along with conventional corn, Shurson said at the Pork Congress seminar. The price of distillers is also rising, however.
John Bruellman, a hog farmer from Ottosen in north central Iowa, said more studies need to be done before hog farmers use higher percentages of distillers in their feed. "I don't like distillers. I did some trying with it, and had some bad experiences with it," the 48-year-old said. "I think it's a ways off until I'll be using it."