Pork Commentary, October 5th, 2020
Jim Long, President-CEO, Genesus Inc.
ASF in Germany
Does this sound familiar – last week the German pig industry asked for government action to increase slaughter capacity. Covid-19 plant restrictions and ASF have caused havoc. At current slaughter levels, there are 50,000 extra hogs not being handled. Feeder pig prices have been cut in half severely impacting Danish and Dutch producers who sell to Germany. Slaughter hog prices have declined to 1.27 Euro a kg which is below cost of production with now over 30 ASF findings in Germany the loss of Asian export markets will be in all likelihood more than 2 years.
USDA cut-outs hit $1.00 a lb. last Thursday morning. Germany’s loss of Asian markets appears to us to be underpinning U.S. pork and hog prices. It’s not just China, but Japan, Korea, Philippines, Vietnam that the U.S. and Canada will benefit from Germany’s misery. With lean hogs in the 70’s in October, solid domestic and export demand, liquidation cutting numbers into 2021. Why can’t we believe lean hogs won’t blow by the 80¢ they are now on lean hog futures next summer. 90¢ – $1.00 is not an unreasonable destination. Hope so – we all need to backfill the hole created over the last while.
Maximized productivity and profit.
The productivity of the world sow herds continues to increase. As the Global Genetic Industry consolidates to four main Genetic Groups – PIC, Topigs-Norsvin, The Danish groups and Genesus, the technology we have brought collectively to bear has pushed not only competitors out of the way but increased litter size. IE USDA report from Dec quarter 2018 – 10.58 litter to June 2020 – 11.04 pig per litter. Below is a comparison of Genesus – Pig Champ database total 365 herds. As you can see by results below Genesus not only has more pigs, heavier pigs but significantly lower sow mortality. Unlike European Genetics the robust structure of Genesus sows keeps them in production and brings full sow salvage value while delivering high productivity. All add up to why Genesus has a world-leading female to maximize productivity and profit.
2019 Data Genesus Mean PigCHAMP USA Mean Genesus Top 10% Average PigCHAMP USA Top 10% Average BA/ Litter 13.32 13.20 14.41 14.31 Liveborn/ Female/ Year 32.45 29.74 35.46 33.92 Farrowing Rate % 88.71% 84.09% 95.06% 90.39% Pre-Wean Mortality % 11.08% 14.55% 3.71% 10.38% Av. Wean Age 22.41 20.82 24.6 23.26 Adj. 21 Days Wean
173.55 130.33 195.28 170.41 Pigs Weaned / Litter 11.76 11.48 12.47 12.37 Pigs/ Mated Sow /Year 28.44 26.08 31.02 30.10 Female Death rate % 4.99% 12.31% 2.1% 7.00%