A Few Thoughts by John Nalivka: Efficiencies are a driver to U.S. livestock production
December 28, 2016
Anyone involved in U.S. agriculture is constantly reminded of the ever-increasing efficiencies that are drivers to the industry. One might look no further than the indicated yield of this year's record corn crop or the pigs per litter in USDA's December 1 Hogs and Pigs Inventory released last week. We often discuss and debate the "return to trend" following any disruption in production indictors whether in crop or livestock production. Two examples are the drought-reduced yield impact to crop production or the PED impact on the pig crop.
Six years ago I attended more than one conference where the conversation, with much hand wringing, centered on the question of whether we would be able to feed the world's growing population. Knowing and feeling pride in America's ability to produce food and fiber, I would admit that I often questioned the skepticism. Using my previously mentioned examples of corn and hogs, the average yield for our drought-ravaged 2012/13 corn crop was 123.1 bushels per acre. This reduction followed the 2011/12 yield of 146.8 bushels per acre and a sharp departure from trend. However, as is always the case, weather is the key. This year, the average U.S. corn yield was not only back on trend, it posted a record 175.3 bushels per acre.
While USDA reported the December 1, 2016 hog inventory reached a record 71.5 million. The fall pig crop was reported to be 32.3 million, also a record. To produce this record pig crop, sows averaged 10.63 pigs per litter, also a record! Yes, I remember I am writing for a cattle industry newspaper, but again the farrowing rate illustrates how quickly U.S. agriculture recovers from adversity. In the height of PED v in U.S. hog herds, the average pigs per litter in winter (December to February) 2014 fell to 9.53 as pig mortality rose sharply. This was down from 10.08 the prior year. As PED v was controlled and the farrowing efficiency once again returned to trend, the figure rose to 10.30 in 2016.
At what point, will U.S. agriculture reach the point of diminishing returns with regard to efficiency? I predict the "efficiency trend line" is still upward sloping. We will definitely realize this in 2017 as increased red meat and poultry production will push per total meat supplies to 218 pounds and toward the record 222 pounds produced in 2007. How producers fare will rest largely upon demand, both in the U.S. and globally.
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