Meet the “new grain farm economics.”
It’s the same as the old grain farm economics, but a lot different from today’s general approach to grain farming.
Midwestern U.S. farmers at the Manitoba Pork Council annual meeting repeatedly mentioned the newfound popularity of hog barns with grain farmers, a trend driven by low grain farming profits.
U.S. grain farming profits were hit particularly hard in the last year as the American dollar soared against the currencies of competitors.
“They want an additional source of income and they want the manure,” said one Iowa farmer representative.
Read Also
Canola support gets mixed response
A series of canola industry support measures announced by the federal government are being met with mixed reviews.
Jay Moore, who works with a Midwestern hog barn management company, agreed that hog barns are popular again as an element of a grain farm. Corn and soybean farmers who don’t have a hog barn on their land want one.
This is due to the low price of grain and the cost of fertilizer, which is pricey relative to the declining revenue from grain. That leads to low margins for crop farmers prompting them to look for any way to boost profits
An easy way is to have free manure from an on-farm hog barn, whether or not the farmer owns the pigs. The manure replaces a lot of chemical fertilizer, and that saved cost directly increases profitability.
“With the margins on the grain side of agriculture, with row crop production being so slim, they’re looking at any way they can to try to save some money to improve their margins,” said Iowa farmer Bill Tentinger.
With the announcement of several new hog slaughter plants in the Midwest, there should be good demand for hogs, encouraging hog farmers to stick with the business and look for new barn sites.
This is marked contrast from recent decades when mixed farms fell out of favour, with grain farmers getting out of cattle and hog production.
That trend was exacerbated from the mid-2000s to mid-2010s by good crop profitability.
