This very real situation has many hog producers looking at how to cut or lower their feed costs or improve feed conversion. Recently we came across what we believe is a very good article on this subject by Vern Pearson, PhD and Mariela Lachmann, PhD.

The article as you will see lays out 20 major factors impacting feed conversion. We are in the swine genetic industry and we hear about feed conversion every day. Of note their number 20 is genetics with relatively little total impact. We agree with this as we see small variation in feed conversion in the over 200 performance tested boars we do a week. Genetics has a much greater impact on litter size, growth and carcass. On the whole, the aggregate of health status has a much greater impact on feed conversion than specific genetics according to Pearson and Lachmann, PhDs.

Ingredient Prices by Improving Feed Conversion Vern Pearson, PhD and Mariela Lachmann, PhD Currently, the highly fluctuating ingredient prices are encouraging producers to evaluate their feeding program. The worst parameter that can be used in feeding program evaluation is feed cost per ton. The feed cost per ton does not account for the effects on pig growth performance. A good parameter that can be used in the evaluation is the cost of feed per pound of gain. Therefore, any improvement in feed conversion can be considered as an opportunity to fight the increasing feed prices. In order to optimize feed conversion (F/G), it is important to recognize the factors that can affect it and their effects (potential to increase or decrease F/G). The following factors can have a significant influence F/G. It is important that producers identify the management practices that can help them optimize feed conversion while maximizing profitability Efficient feeder management and biosecurity practices can have dramatic effects on improving feed conversion This includes rodent control. (see factors 1 to 13). Manipulation of nutrient levels in the diet need to be oriented to match pig nutrient requirement, and to improve pig nutrient utilization (see factors 14 to 19). As feed costs increase the best way to maximize your profit is to optimize feed conversion in the finishing hogs. Feed cost is 55 to 60 per cent of your annual cost of production. Utilizing inexpensive or poor-quality diets is being 'penny-wise and pound-foolish.'

Markets

• US hog prices are hovering around 80¢/lb. lean. Historically a good price, but with current feed prices calculates to us a per market hog loss farrow to finish of $25-30 per head.
  
  
• The latest weekly sow slaughter was 64,525. This is liquidation level. The sow herd continues to shrink as we believe anything over 55,000 to 57,000 a week leads to a smaller sow herd.
  
  
• Summer lean futures are around $1.00/ea but we still expect cash will reach beyond this pushing closer to $1.10. A big reason is the USDA latest projection of total red meat and poultry supply being down 2.4 billion pounds fro 2012, or five pounds less per capita. The way to ration less supply is higher prices. We had $1.00 lean hogs in 2012. Hard to believe less red meat and poultry will not lead to higher hog prices in 2013.