
It is beginning to feel like wherever I turn I am reminded of the importance of diversified farming and the problems associated with the current specialization the industrial farm model. My latest affirmation came from an article titled, "Hog price pain is different this time around," from the "Iowa Farm Bureau Spokesman." My father-in-law dropped off quite a few issues when he stopped by this week and I found a lot of interesting articles. But, this one caught my eye right away.
As you may know, if you read this blog regularly or semi-regularly, we are planning on getting some hogs this summer. Maybe not the breeding stock that I would like to eventually get, but at least some feeder pigs that we can finish for ourselves and a customer or two. We just want to get a feel for pastured pigs and finishing them. But, whenever I talk to local farmers about getting pigs (or farming in general) I get the same response ... "There is no money in pigs (or farming for that matter)."
According to the article the pain that hog producers are feeling in this most recent price down swing is worse than they have felt in other down times (early 90's and late 90's). This is because there has been a huge shift in the hog farm structure even in just the last 10 years. In 1998 when prices dropped to the bottom it was tough on farmers, but they liquidated herds, tightened their belts, and made it through the short-lived down turn. The difference is that 10 years ago many of the hog farmers were at least slightly diversified and were growing their own corn for feed.
Now hog farmers are facing a double whammy even though they are again liquidating their herds. Most hog farmers have specialized to the point that they no longer grow their own feed and must buy in everything. This puts them in the position that they feel the pinch from low prices and from the high input costs (feed, fuel, and equipment).
I think the most interesting thing about this article article is the conclusion that it comes to. John Lawrence, who is a livestock economist at Iowa State University, concludes that there will be better times for hog farmers by the summer of 2009. Basically he notes that herds have been reduced and demand is seeing a slight up-tick, so things should get better eventually.
To me that shows a MAJOR flaw in the current agricultural mindset from the farm economists all the way to the farmers. If we look back throughout history and see that these price down-swings were not as tough on farmers when they were diversified as opposed to when they are specialized shouldn't we learn something? Maybe we should learn that farm diversification is the key?
Well, we should probably learn that, but then it wouldn't fit the "great" industrialized model we have now in agriculture! (That is my very sarcastic statement for the day)