Sunday, May 4, 2014

Pig shortage in Western WA

I've sold 200 or so piglets in the last month, and I wish that I had another 500 to sell.  There's a pretty big piglet shortage around here.  There are several things going into this; first, it's the high season for pig sales; this is the time of year that people most want to buy pigs.  Second, WSU closed their swine center, and the pigs that they used to produce were taken off the market as well.   

And there's a virus that's killing pigs all over the place, which means that there we're short between 4 and 5 million pigs nationwide.  

Plus high feed prices and relatively low profit margins, and even some small pig producers left the market locally.  

So the result of all of that is that we sold the first 200 pigs in in about 6 hours.   We've got another batch of 100 pigs that we're selling now; raised the price a bit, to $125 each to see if it would slow down the sales, but most buyers aren't even blinking.  They're feeling like they either get a pig or not this year, and most would rather have them.  

My piglet production this year is up; we're getting larger litters, and weaning more; most of that is due to better facilities at the new farm -- we can keep the pigs warmer and dryer and cleaner during the hard winter months, and I've also reserved 10 gilts out of the 300 pigs so far this year to increase our production a little bit more.  

Pig sales are a little bit of feast or famine.  I'll have 100 pigs born in a day, and look at them and think that I'm drowning in pigs.  And then 8 weeks later, when I see all of them go in a couple of hours, I wish I had 500 more to sell.  

Short term this is good for the bottom line.  Long term, if it's too much trouble to get pigs, people will just not raise them.  

I have 26 pigs that will be ready in 3 weeks, and 15 more ready in 5 weeks; I'm taking deposits on them, and we'll hold them for 2 weeks after their pickup date with a deposit in hand.  Otherwise it's first-come, first served.   


Walter Jeffries said...

Problem is you're charging too little. The pigs are worth $300 the way I figure although I only charge $200 for boar weaner feeder piglets at six to eight weeks weaning plus a week or so of acclimation. I set that value based on the value of the meat and other inputs someone would have to get it to size based on what I can sell the meat for as a finisher or roaster.

I get calls and emails almost daily asking for piglets. We're reserved out to July now. Like you, I figure I could sell hundreds more piglets if I had them. For us piglet sales are the elasticity in our supply - piglet sales let us justify keeping a few more sows than we need just for our own farm's meat production via finishers. That makes sure we have the supply we need of piglets for our regular meat customers.

Here's an experiment: Bump the price of boar / barrow piglets to $150 and gilts to $200. Observe what happens and you'll learn a lot about the price points. I sex differentiate the pricing because I want to keep back more gilts to watch as possible breeder material. 5% of gilts get tested. Only 0.5% of boars get tested so this biases my sales towards the boars as piglets.

Jeff said...

So Walter, you're selling hundreds of weaners at $200/$250 a piece?

Jeff said...

I admit my laziness, but I just went to your site and had my question answered. $200/$300. That's amazing!

Bruce King said...

I've been the price-leader in my area for weaner pigs. I'd like to see this price remain -- at this level it's profitable to raise them, and I'm hoping that gets more people to have more production in this area.

The virus situation in the midwest will sort itself out in the next year.

At $300 each, I'd clear more than $200 a pig in profit; while that sounds great on paper, that pushes weaner pigs into a luxury item, and I'd rather not be the guy who sells to people who don't care what it costs. Local food should be available to locals, and at a price that makes sense.

heck, at $300 each, my farm would be grossing over $600k a year, and netting something like $350k a year. That's quite the margin, Walter.