xt7qnk362j28 https://exploreuk.uky.edu/dips/xt7qnk362j28/data/mets.xml   Agricultural Experiment Station, Department of Agricultural Economics, University of Kentucky 1970 journals kaes_research_rprts_04 English University of Kentucky Contact the Special Collections Research Center for information regarding rights and use of this collection. Kentucky Agricultural Experiment Station Research Report 4 : March 1970 text Research Report 4 : March 1970 1970 2014 true xt7qnk362j28 section xt7qnk362j28  2   Developments in the Feeder—Pig lndustry and
  Trends and Cycles in Prices and Receipts
  Of Feeder Pigs in Kentucky
 { By
  Harry R. White, D. Milton Shuffett, and Robert W. Rudd
 DQ • i
 f` nzsmcn moan ; Mimi. mo
 W . University of Kentucky :1 Agricultural Experiment Station
  Department of Agricultural Economics
{ Lexington

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’

 TABLE OF CONTENTS
Page »
C LIST OF TABLES ........................ iii
LIST OF ILLUSTRATIONS ..................... iv
INTRODUCTION ......................... T
A Data for this Study .................... T
V Purpose of Study ...................... 2
PRESENT STATUS OF THE FEEDER—PIG INDUSTRY ........... 2
Feeder-Pig SurpTuses or Deficits of IndividuaT States,
North CentraT Region ................... 4
Feeder—Pig Trade by States ................. 4
Evidence of the Emergence of a Feeder-Pig Industry in
Kentucky ......................... 6
Importance of Feeder-Pig Production in Kentucky ...... TO
Marketing Systems for Kentucky Feeder Pigs ......... TT
FEEDER—PIG PRICE AND MARKET RECEIPTS TRENDS .......... TT
Market Receipts Trends ................... TT ‘
Trend in Average Height of Feeder Pigs Marketed .... TT
Feeder—Pig Price Trends .................. T5
CYCLICAL MOVEMENTS IN FEEDER-PIG PRICES AND MARKET RECEIPTS . . T7
Feeder—Pig Price CycTes .................. T7
Comparison with CycTes in Hog Production .......... T8
Causes of CycTes in Hog Production ........... 2T ·
SUMMARY ............................ 22
LITERATURE CITED ....................... 26
ii

 LIST OF TABLES
Tab1e Page
1. Direct Inshipments of Feeder Pigs into Iowa, I11inois, {
Indiana and Ohio, by Years, 1956-67 .......... 5 ¥
2. Direct Inshipments of Feeder Pigs into Iowa by State
of Origin, by Years, 1956-67 ............. 6
3. Inshipments of Feeder Pigs into I11inois by State of
Origin, by Years, 1958-67 ............... 7
4. Direct Inshipments of Feeder Pigs into Indiana by State
of Origin, by Years, 1957-67 ............. 7
5. Inshipments of Feeder Pigs into Ohio by States, by
Years, 1960-67 .................... 8
j 6. Outshipments of Hogs for Feeding and Breeding from
Wisconsin, by State of Destination, by Year, 1955,
° and 1958-67 ...................... 8
‘ 7. Feeder Pig Shipments from Kentucky, by State of Des-
tination, by Years, 1957-67 .............. 9
8. Average Receipts and Annua1 Trend Movements for Feeder
Pigs by Height Groups, Five Centra1 Kentucky Auction
Markets, 1949-62 ................... 13
9. Average Receipts and Annua1 Trend Movement for S1aughter
Hogs at Seven Midwest Termina1 Markets, 1949-62 .... 15
10. Trend Comparison of Annua1 Average (Def1ated) Price of
Feeder-Pigs (over 1OO Pounds) with S1aughter-Hog Price ,
(Def1ated) at Five Centra1 Kentucky Auctions and Seven —
‘ Midwest Termina1s, 1949-62 .............. 17
11. Trend in Annua1 Average Price of Feeder Pigs (Def1ated)
and Significance of Trend at Five Centra1 Kentucky
Auction Markets, 1949-62 ............... 18
12. Fa11 Farrowing as a Percentage of Spring Farrowings by
States, 1955-67 .................... 24
. iii

 LIST OF ILLUSTRATIONS
Figure Page
1. Approximate Market Supp1y Area of Five Centra1 Kentucky
Livestock Auction Markets ............... 2 .
2. Trend of Market Receipts of Feeder Pigs (under 16O 1b) at
Five Centra1 Kentucky Auction Markets, 1927-62 .... 12
I 3. Trend of Average Height of Feeder Pigs (under 16O 1b) at
Five Centra1 Kentucky Auction Markets, 1949-62 .... 14
_ 4. Trend in Feeder-Pig Prices (under 16O 1b) at Five
Kentucky Auction Markets, 1949-62 ........... 16
5. Cyc1es in Feeder—Pig Prices at Five Centra1 Kentucky
Auction Markets and Cyc1es in Hog Prices, Chicago,
1949-62 ........................ 19
6. Comparison of Cyc1es in Hog Production in Kentucky and
the United States, 1949-62 .............. 2O
7. Cyc1ica1 Movements of Receipts of Feeder Pigs (under 16O
1b) Compared with Cyc1ica1 Movements of Receipts
of S1aughter Hogs, 181-229 1b, Centra1 Kentucky
Auction Markets, 1949-62 ................ 23
I iv

 · LIST OF ILLUSTRATIONS
Figure Page
l. Approximate Market Supply Area of Five Central Kentucky
Livestock Auction Markets ............... 2 -
2. Trend of Market Receipts of Feeder Pigs (under l6O lb) at
Five Central Kentucky Auction Markets, l927-62 .... l2
3. Trend of Average weight of Feeder Pigs (under l6O lb) at
· Five Central Kentucky Auction Markets, l949-62 .... l4
4. Trend in Feeder-Pig Prices (under l6O lb) at Five
Kentucky Auction Markets, l949—62 ........... T6
5. Cycles in Feeder-Pig Prices at Five Central Kentucky
. Auction Markets and Cycles in Hog Prices, Chicago,
_ l949—62 ........................ T9
6. Comparison of Cycles in Hog Production in Kentucky and
I the United States, l949-62 .............. 2O
7. Cyclical Movements of Receipts of Feeder Pigs (under l6O
lb) Compared with Cyclical Movements of Receipts
of Slaughter Hogs, l8l—229 lb, Central Kentucky
Auction Markets, l949—62 ................ 23
iv

 DEVELOPMENTS IN THE FEEDER—PIG INDUSTRY AND
TRENDS AND CYCLES IN PRICES AND RECEIPTS
OF FEEDER PIGS IN KENTUCKY i
By i
Harry R. Hhite,* D. Milton Shuffett, and Robert H. Rudd
This study is a continuation of a portion of an earlier research
study and represents a reappraisal of the developments, including trends
and cyclical patterns of market receipts and prices of feeder pigs, in
a five-market area of Central Kentucky. Earlier research by Rudd [9]
for the same five Central Kentucky markets analyzed data for the period
l926-48. The present study uses as primary data the observations on
market receipts, weights, and prices of feeder pigs on the same five
I auction markets from l949 to l962. However, to insure continuity in
the research and analysis, some of the data series were combined for
analysis using all available data from l926 to l962. Although the ma-
jor objectives of this study relate to an analysis of trends and cycles
of feeder-pig prices and receipts in the central Bluegrass area of
Kentucky, an effort has been made to compare the results obtained with
those from other feeder-pig producing areas.
Data for this Study
The data for this study were taken from the sales records of
five Central Kentucky auction markets located at Danville, Lexington,
Winchester, and Paris] and serving most of Central Kentucky (Fig. l).
These markets are among the largest of the 2l auctions located in l8
towns in the Bluegrass area.
Selection of markets was made on the basis of size and sales- _ ’
day continuity. Size assures sufficient market receipts for continuous
price quotations. This group of markets gives a complete set of sale
A *Former Research Assistant, Department of Agricultural Economics,
University of Kentucky.
lLivestock auction markets supplying sales data were: Boyle County ‘
Stockyards, Danville; Bluegrass Stockyards, Lexington; Clay—Gentry
Stockyards (later operating as Clay—Wachs), Lexington; Farmers
Sales Company, Winchester; and Bourbon County Stockyards, Paris.
j l

 2
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Fig. l.--Approximate Market Supply Area of Five Central
Kentucky Livestock Auction Markets.
days Monday through Friday each week which makes possible a continuous
price reflection. .
Purpose of Studv
The objectives of this study were: (l) to determine the nature
of trends and cycles in feeder—pig prices and receipts; (2) to deter-
mine if time-series components of feeder—pig prices and receipts at
five central Kentucky markets had changed since the period l926—48; '
(3) to determine if the price relationship between feeder pigs and .
slaughter hogs reveals a definite trend or cyclical pattern; and
p (4) to identify the factors most likely to influence trends and cycles
in the feeder pig-slaughter hog price relationships.
Pptseuvi smius or THE FEEDER—PIG mpusiev
The increase in specialization and the decrease of opportunistic
buying and selling in the feeder-pio industry have brought some very

 3
significant changes in the average weight at which feeder pigs are sold. j -
The trend toward specialization in the feeder-pig industry should result
in feeder pigs being traded at weights which fall within the narrow
range where the two hog—production phases overlap. The available evi-
dence indicates that this range should extend from 40 to 60 pounds with
pigs averaging around 8 to 9 weeks old.
Data obtained from the wisconsin Feeder-Pig Marketing Coopera— "
tive [ll] indicate that for the years l958-62 the average weight of ¢
feeder pigs sold in wisconsin ranged from 45.5 to 46.3 pounds for an
average volume of 225,864 head. The minimum weight was 40 pounds, and
very few pigs were sold above 60 pounds.
Combined sales data for six southern Indiana auctions [7] for
the years l954—64 indicate the average weight over the ll-year period
was 58.45 pounds for an average annual volume of 44,772 head.
In Missouri the published feeder—pig sales reports of the
Missouri Cooperative Feeder Livestock Association [6] for the years
l955-62 indicate that the average weight of the majority of sales is
in the range of 55 to 65 pounds. F
Information obtained from the Tennessee Agricultural Experiment
Station [3] shows that the average weight of feeder pigs sold through
feeder-pig sales in that state was 53.8 pounds, for an average volume
of 60,863 head during the years l960-63.
The Minnesota Crop and Livestock Reporting Service [5] reports
the average age of feeder pigs purchased by farmers in that state dur-
ing l963 was 7.9 weeks with an average weight per head of 44.5 pounds.
This compares with the average of 8.0 weeks and an average weight of _
43.4 pounds reported for l96l.
Gaydon [2], in an Indiana study on feeder-pig price discovery,
reported that farmers who were set up to feed purchased feeder pigs
efficiently were anxious to obtain pigs at the minimum weight and age
consistent with a feeding rather than a rearing program. From a study
of pricing formulas used to determine how much a buyer can pay for I
feeder pigs it was also revealed that some buyers attempt to induce
producers to sell at the minimum practicable age and weight by specify-
ing that they are not prepared to pay more per pound for pigs over, for
example, 50 pounds than their own cost of putting on a pound of gain at
similar weights.
It appears from the available evidence that the preferred weight
for feeder pigs is trending toward 40-50 pounds. The trend is especially
evident in the case of interstate shipments of pigs. Feeders want
thrifty, healthy, fast-gaining pigs ready to move ahead rapidly in the
feed lots. These pigs will normally weigh 40 pounds or more at 8 weeks
of age.

 4
Feeder—Pig Surpluses or Deficits of Individual States, V
North Central Region
The "net positions" of states, with respect to whether an ex-
porter or importer of feeder pigs, points out the fact that the trade
volume of feeder pigs can be broken into two parts, i.e., feeders
moving solely in intrastate trade and those moving in interstate trade. j
Very little reliable data are available on the volume of feeder pigs
moving in intrastate trade. However, the system of permits and in- ·
spections governing the interstate shipment of feeder pigs has made
a reliable source of data available on interstate movements of feeder
pigs.
Imports of feeder pigs into Iowa, Illinois, Indiana, and Ohio
are summarized in Table l for the years l956—67. Extreme accuracy
cannot be claimed for the inshipment data since Gaydon [2] observed
that data collected by a sample survey in the states of Iowa and
Illinois failed to match up exactly with the data presented here
which are a by—product of state import licensing and inspection re-
quirements. It is believed, however, that the data provide a useful
indication of the general level of feeder—pig interstate movements.
Feeder—Pig Trade by States
The primary movement of feeder pigs in interstate trade appears
I to be unidirectional into Iowa, Illinois, Indiana, and Ohio from states
surrounding them. The available data can be analyzed on the basis of
inshipments of feeder pigs into Illinois, Indiana, Iowa, and Ohio by
state of origin. A more—or—less complete picture of the pattern of
all the feeder pigs moving in interstate shipments is available for _ ‘
analysis, since other interstate movements are small compared with
[ the large flow of pigs into the four major deficit states.
Shipments of feeder pigs to the west coast represent a possible
exception to this general pattern. Records were not kept on the number
[ of feeder pigs entering California prior to August l963. The data
available [8] show 8,7lO head shipped to California from August to ,
December l963. In l964 there were 27,4l2 head shipped in and in l965
inshipments increased to 37,475 head. Nebraska was the state of origin
for 89 per cent of these shipments, lO per cent came from Iowa, and one
per cent originated in Missouri.
The state of Nashington does not record inshipments of swine
by feeders, for slaughter, or by state of origin. The total inship-
ments of swine for l964 and l965 were l36,402 and l2l,439 respectively.
» These data are insufficient to conclude that the west coast is a major
importer of feeder pigs.

 5
TABLE l j ·
DIRECT INSHIPMENTS OF FEEDER PIGS INTO IOHA, ILLINOIS, INDIANA
AND OHIO, BY YEARS, l956-67
State 1956 1957 1958 1959 1960 1961 1962 1963 1964 1965 1966 1967 I
—-——----——----------·---—-—-—---- thousand head ------------------------——------- A
Iowa 382 475 587 806 1,153 683 645 747 808 735 755 734 I
Illinois -- 148 330 304 173 220 275 394 321 321 347 396
Indiana -- 195 498 402 463 641 836 691 606 508 579 711
ohm -- -- -- -- 133 191 258 224 184 174 179 221
Sources: Iowa: Iowa Crop and Livestock Reporting Service, Iowa Department of Agriculture,
Division of Agricultural Statistics.
Illinois: Illinois Crop and Livestock Reporting Service, Illinois Department of Agriculture,
Division of Agricultural Statistics.
1 Indiana: Indiana Crop and Livestock Reporting Service, Statistical Reporting Service, U. S.
Department of Agriculture.
Ohio: Ohio Crop and Livestock Reporting Service, Ohio Department of Agriculture,
Division of Animal Husbandry.
The inshipments of feeder pigs into Iowa by state of origin are
shown in Table 2 for the period l956-67. The Iowa Crop and Livestock
Reporting Service indicates that the data shown in Table 2 are largely
feeder pigs, but include a few breeder hogs, show hogs, etc., which
’ come into the state for purposes other than for feeding for slaughter.
Market data by states of origin are not available. However, the di-
° rect inshipments should provide a good indication of the source of
feeder pigs by states.
The major suppliers of feeder pigs to Iowa are Hisconsin,
Missouri, and Minnesota. These three states supplied 83.9 per cent of
the feeder pigs sent to Iowa from l965 to l967.
Table 3 shows inshipments of feeder pigs into Illinois. Mis-
consin was the main supplier, with Arkansas showing the most rapid
increase in importance during the period l958-67. Feeder—pig inship-
ments have not shown the increase in Illinois that is evident in other
states. .
Inshipments of feeder pigs into Indiana by state of origin are
_ shown in Table 4 for the years l957-67. The most important change oc-
curring was the very substantial increase in inshipments during the
» period. Tennessee was the principal source of feeder-pig imports, al-
though Arkansas and Kentucky and, to a lesser extent, Missouri showed

 6
TABLE 2 j
DIRECT INSHIPMENTS OF FEEDER PIGS INTO IOWA BY STATE
OF ORIGIN, BY YEARS, l956-67
I State 1956 1957 1958 1959 1960 1961 1962 1963 1964 1965 1966 1967
---——-----—----------—---------- thousands of head ----—---—----------—-----—---——- V
North Dakota 1 2 11 65 17 13 - - -(1ess than 1, OOO head)- - - J
Arkansas 4 23 12 15 13 3 8 11 27 24 35 47
IHin0B 2 1 6 3 4 3 2 3 7 33 62 69
hiinnesota 51 51 93 144 217 132 100 143 179 143 197 117
Nihsouri 92 171 136 113 282 143 185 210 195 200 188 231
Nebraska 39 6 5 10 10 7 4 5 4 5 5 3
South Dakota 13 12 15 82 36 18 15 7 9 7 6 3
\VBcon$n 169 202 298 361 549 352 328 364 384 298 255 236
AIlC¤hem 12 8 11 13 25 12 3 4 3 25 7 28
Total 383 476 587 806 1,153 683 645 747 808 735 755 734
Source: Iowa Crop and Livestock Reporting Service, Iowa Deparmient of Agriculture, Division of
Agricultural Statistics.
increases in importance. Tennessee, Kentucky, Arkansas, and Missouri
have increased in importance as suppliers of feeder pigs to Indiana,
Illinois, and other corn—belt states.
Inshipments of feeder pigs into Ohio by states of origin for
l960·67 are shown in Table 5. Wisconsin, Kentucky, and Tennessee
supplied 64.4 per cent of the feeder pigs shipped into Ohio during
l955-64 and 7l per cent during l965-67. Indiana and Michigan show
increasing importance; however, in the case of Indiana, the feeder
pigs may have originated in other states and been shipped through
Indiana. A comparison of data in Table 4 with Table 6 shows that
Indiana consistently reports more inshipments of feeder pigs from
wisconsin than are reported as outshipments to Indiana by wisconsin.
Evidence of the Emergence of a Feeder-Pig Industry in Kentucky I
Buying and selling of feeder pigs have, until recently, been
the result of short—term adjustments to changes in feed costs or changes
in the financial position of the participant. A transformation toward
a commercial feeder-pig industry based on the demands of a deliberate
over—all business policy is now evident.
. Evidence of development of pigs as a regular farm enterprise
is available in substantial volume. For example, the shipment of _
‘ feeder pigs from Kentucky to Indiana has developed into a substantial
industry during recent years (Table 7).

 7
TABLE 3 ‘
INSHIPMENTS OF FEEDER PIGS INT0 ILLINOIS BY STATE OF
ORIGIN, BY YEARS, T958-67
 
State 1958** 1959 1960 1961 1962 1963 1964 1965 1966 1967
——----———-—--—-·-—---—-- thousand head -------------——--—-------——-
Wisconsin 183 189 82 98 49 55 174 133 136 103
Missouri 28 84 34 39 33 32 103 74 75 116
Tennessee 12 22 28 33 19 3 18 8 8 22
Indiana 1 3 11 17 12 4 23 23 36 45
Arkansas -- 1 6 18 20 9 38 40 43 51
Kentucky b —- -- -— -- —- S 17 23 26 41
Other States 1 5 12 15 12 5 21 20 23 18
Total 225 304 173 220 145 113 394 321 347 396
alncludes May—December 1958 only. january-April 1958 not available.
bOt.her states include Minnesota, Georgia, Iowa, Louisiana, Pennsylvania, Oklahoma,
Texas, Delaware, Maryland, and Alabama.
Source: Illinois Department of Agriculture, Division of Agricultural Statistics.
TABLE 4
DIRECT INSHIPMENTS OF FEEDER PIGS INT0 INDIANA BY
STATES OF ORIGIN, BY YEARS, l957—67 _ I
 
State 1957 1958 1959 1960 1961 1962 1963 1964 1965 1966 1967
 
------------------------------ -thousand head ---———--—---------———- - —--——
Tennessee 148 338 192 280 324 415 330 262 203 263 308
Arkansas 1 27 46 54 101 127 70 31 21 15 4
Kentucky 14 48 73 81 99 161 147 147 130 162 240 ,_ '
Missouri 5 20 28 23 67 84 74 89 95 78 89
Wisconsin 17 40 53 13 28 30 52 66 36 29 24
Other States 10 24 10 12 22 19 18 11 23 32 46
Total Direct
Shipments 195 498 402 463 641 836 691 606 508 579 711 -
 
Source: Indiana State- Federal Crop and Livestock Reporting Service.

 8
TABLE 5 `
I INSHIPMENTS OF FEEDER PIGS INTO OHIO BY STATES,
BY YEARS, l960-67
V State 1960 1961 1962 1963 1964 1965 1966 1967
———--—--—----—---—·-----—---— thousands of head ----·—---—-—-------------
Wisconsin 29 61 65 70 62 60 59 41 K
Kentucky 56 47 44 44 39 58 56 74
Tennessee 13 29 48 21 10 13 16 31
Indiana 4 17 32 23 25 18 13 27
Michigan 2 11 16 18 14 13 15 13
North Carolina 16 9 22 17 10 5 7 13
Arkansas ·- -- 9 11 9 -- -- 1
West Virginia -- 2 2 5 6 4 4 3
Virginia —- 2 2 7 5 -— -- --
Pennsylvania —- -- 5 6 3 2 4 4
Other Statesb 13 13 13 2 1 1 5 14
g Total 133 191 258 224 184 174 179 221
3Breakdown by state of origin was not available before 1960. Total inshipments in preceding
years: 1956, 5,000 head; 1957, 6, 000 head, 1958, 9, 000 head, 1959, 26,000 head.
bStates with less than a thousand head reported.
Source: "Shipment of Feeder Pigs into Ohio from Other States, " Ohio Crop Reporting Service, Ohio
Department of Agriculture, Division of Animal Industry.
TABLE 6
OUTSHIPMENTS OF HOGS FOR FEEDING AND BREEDING FROM WISCONSIN, I
BY STATE OF DESTINATION, BY YEAR, l955, AND T958—67a
 
State 1955 1958 1959 1960 1961 1962 1963 1964 1965 1966 1967
 
------------------—--------- thousands of head ---—-—--—--——-—--——----——---
Iowa 151 250 286 379 339 388 396 368 295 258 253 .
· Illinois 70 254 196 83 93 122 183 151 129 124 106 _
Ohio 11 8 25 23 46 59 63 47 52 47 37
Indiana 33 35 41 10 24 29 47 65 35 30 21
Minnesota 20 44 37 27 25 22 17 12 9 23 43
Michigan 4 1 l 5 11 14 12 9 8 10 10
South Dakota 1 7 6 8 14 9 14 18 20 15 45 ,
Nebraska —— 7 11 7 12 13 3 -- -— 1 33
Other States 13 10 11 7 13 5 6 12 18 14 10
Total 303 616 614 549 577 661 741 682 564 522 558
V
aPem1its issued by Division of Animal I-Iealth, Wisconsin Department of Agriculture,
almost entirely for feeding.
Source: Wisconsin Agricultural Statistics, Wisconsin Statistical Reporting Service.

 9
TABLE 7 j
FEEDER PIG SHIPMENTS FROM KENTUCKY, BY STATE OF
DESTINATION, BY YEARS, l957—67
state 1957 1958 1959 1960 1961 1962 1963 1964 1965 1966 1967
—----——----—-—--·----——------ thousands of head ---——----—----—--——-—---—-- '
Indiana 14 48 73 81 99 161 146 147 129 161 240 J
ohio -- -- -- 56 47 44 44 39 23 26 41
Total 14 48 73 137 146 205 190 186 152 187 281
Sources: Indiana: Indiana State Federal Crop and Livestock Reporting Service.
Ohio: Shipment of Feeder Pigs into Ohio, Ohio Crop Reporting Service, Ohio
Department of Agriculture, Division of Animal Industry.
Shipment of Feeder Pigs into Ohio from Other States, Ohio Crop Reporting
Service, Ohio Department of Agriculture, Division of Animal Industry.
Interviews with local market representatives indicate that
Indiana and Ohio are the largest receivers of feeder pigs shipped inter-
, state from the Central Bluegrass area. A substantial increase has
developed in the number of feeder pigs transported to Indiana over the
I period since l957.
A second example of evidence supporting the emergence of a
distinct and viable feeder—pig industry in the Central Bluegrass area
of Kentucky is the upward trend in feeder-pig production in the five
market areas of Central Kentucky. For the years l949 to l962, the
trend in production of feeder pigs weighing less than 80 pounds in-
creased at an average annual rate of 6.77 per cent.
The changes taking place in the Kentucky feeder-pig industry
are only a part of a much larger change taking place in the industry
in general. Purchases of feeder pigs for l956 in the North Central
Region, which includes Kentucky and the c0rn—belt states, amounted
to 7.4 million head and constituted approximately lO.2 per cent of
total hog marketings. Radical changes appear to have taken place
since 1956 as shown by the changes in Illinois and Indiana, the number
. two and number three hog—producing states in the United States. In
l956, feeder-pig purchases as a percentage of hog marketings in Illinois
and Indiana were 9.7 per cent and 7.4 per cent, respectively. Gaydon [2] -
_ reported that by l96l these proportions were approximately 20.0 per
cent in both states.
An increasing number of farmers are recognizing the dichotomy
of the slaughter—hog production process, i.e., the labor-intensive,
feed-extensive nature of feeder-pig production and the_feed-intensive,
labor—extensive nature of finishing purchased feeder-pigs.

 l0
Technological advances in feeder-pig and slaughter-hog produc- -
tion have provided the opportunity and the incentive to increase
specialization. Advances in the design of farrowing houses, including
heating and ventilation, have made it possible to successfully farrow ,
sows in winter without unreasonable increases in costs and, as a re-
sult, cut down on the highly seasonal nature of sow farrowing. wis- _
consin, for example, has increased fall farrowings as a percentage of
spring farrowings from a long-term average of 50 per cent before l955 ;
to 83 per cent in l960, 85 per cent in l964, and 92 per cent in l967. '
Also, spring and fall farrowings have leveled out by months with re-
latively heavier farrowings in November, December, and January than
was the case before l955.
Another technical advancement that has given emphasis to the
development of a specialized feeder-pig industry has been the develop-
_ ment of techniques and equipment to reduce significantly the labor
involved in feeding, watering and manure disposal associated with the
finishing of purchased feeder pigs. From an economic point of view,
the desirability of exploiting the comparative advantage found in
separating hog production into the two components of feeder-pig pro-
duction and finishing purchased feeder pigs means serious consideration
should be given to accepting specialization as a way of operation in
the hog business.
Importance of Feeder-Pig Production in Kentucky
Farmers in the Central Kentucky area, which is the principal
feeder-pig producing area in the state, sold 4l3,000 head of hogs in
l964. Approximately half of the hogs sold in the Central Kentucky
area are feeder pigs. `
Kentucky feeder-pig production is localized to a great extent
in the Central Kentucky area. There are several factors which support
this localization: (l) feeder-pig production requires pasture in ex-
cess of other livestock needs, and in the Central Kentucky region one
half to three fourths of the agricultural land is in pasture; (2) small
grain crops are seeded in the fall and provide added late fall and
early spring pasture; (3) the Central Bluegrass area is a corn-deficit
area owing in part to the shallow soil with bedrock close to the sur-
face which discourages large corn acreages-—feeder pigs can be eco-
nomically produced on a limited supply of concentrate feed, whereas
the production of slaughter hogs would require expensive inshipments
of corn; and (4) the feeder enterprise is flexible in that the farmer
can decide at any time after weaning age to sell feeders or hold his
hogs for heavier weight, depending on price and cost expectations. How-
ever, with increased specialization some of the inherent flexibility
associated with feeder-pig production will be lost.

 ll I
Marketing Systems for Kentucky Feeder Pigs j
The primary market outlets for feeder pigs are local auction
markets and the popularity of the local auction market as an outlet for I
Kentucky feeder pigs is due primarily to the geographic convenience of
these markets. Also, the local auctions sell pigs on a pen—lot basis
with feeder pigs of equal quality sold in each lot. A
~ FEEDER PIG PRICE AND MARKET RECEIPTS TRENDS
I Market Receipts Trends
Market receipts of lightweight feeders show a very significant
upward trend since l949. Market receipts of all feeder pigs under l60
pounds at five Central Kentucky auctions have shown a rising trend
from l949 to l962, an average of 3.l0 per cent gain annually (Fig. 2).
· The increase in feeder-pig receipts was mainly in the lighter weights.
Market receipts of feeder pigs weighing less than 80 pounds increased
at an average annual rate of 6.77 per cent over the period l949—62,
while receipts of heavier feeders weighing l00—l60 pounds decreased
over the same period (Table 8). Market receipts of the heavier—weight
feeders correspond closely with the observed trend in market receipts
for slaughter hogs at the same Central Kentucky markets. The market
receipts of slaughter hogs weighing l8l—220 pounds decreased by an
average of 0.2l per cent annually over the l9A9-62 time period.
Trends in hog production? in Kentucky generally were greater
than trends in market receipts. Hog numbers in Kentucky show an up-
ward trend at the rate of l.52 per cent per year over the period
l927-62.3 Nationally, hog production increased at the rate of 0.55
per cent per year during the period l928—6l. Production of light-
weight feeders (under 80 pounds) is transcending both the annual state
production movements and the national hog—production movements (Table 8).
I Trend in Average Height of Feeder Pigs Marketed .
Rudd [9] reported that the average weight of feeder pigs marketed _
on Central Kentucky markets exhibited a steady downward trend through
2Live weight of hogs produced annually, as published by Statistical I
I Reporting Service, U. S. Department of Agriculture, was used.
3Production statistics for hogs by counties on an annual basis are not
available. The nearest approximation is the census figure on number
of hogs on farms available every fifth year. For the Central Kentucky
area there appears to be no significant change in hog numbers as near
as can be estimated from the limited data (1950-62).

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 13
TABLE 8 .
AVERAGE RECEIPTS AND ANNUAL TREND MOVEMENTS FOR
FEEDER PIGS BY WEIGHT GROUPS, FIVE CENTRAL
KENTUCKY AUCTION MARKETS, 1949-62
Average Annua1 Trend Annua1 Trend Move-
Neight Group Receipts Movement ment as a Per Cent of L
(1b) (head) (head) Average Receipts s
20-39 10,208 +1922 19.0
40-59 16,464 +1328 8.07
60-79 22,175 +1022 4.61
80-99 18,716 + 318 1.70
100-119 12,202 - 142 - 1.16
120-139 7,034 - 171 - 2.43
140-159 6,274 - 204 - 3.25
Under 80 44,769 +3030 6.77
Under 160 88,072 +2735 3.10
- the period 1927-48. The average weight of feeder pigs marketed in
1927 was approximate1y 110 pounds, and this decreased to approximate1y
100 pounds by 1948. The importance of this trend was 1essened by the ·
fact that 1ightweight feeder pigs usua11y made up on1y about one tenth
of tota1 receipts. The trend in average weight for feeder pigs mar-
keted on the same Centra1 Kentucky markets for the years 1949-62 shows
a continuing decrease in the average weight at which feeder pigs are
marketed from approximate1y 100 pounds in 1949 to 68 pounds in 1962
(Fig. 3). The significance of this trend is great1y increased by the »
change in the proportion of tota1 receipts made up by 1ightweight feeders. `
In 1949 a11 feeder pigs under 80 pounds constituted 27 per cent of the
tota1 receipts of feeder pigs under 160 pounds so1d on Centra1 Kentucky
auctions. By 1962 feeder pigs under 80 pounds made up 72 per cent of
a11 feeder pigs under 160 pounds so1d at these markets. The increas-
ing trend in market receipts of feeder pigs weighing 1ess than 80
pounds, particu1ar1y from 1954 to 1962, cannot be exp1ained in terms ’
of an increased demand for pork on the part of consumers since the
per-person consumption of pork in the U. S. shows a 1ong-run trend for
the period 1931 to 1962 which is not significant1y different from zero.
A1so an ana1ysis of the trend in sa1ab1e receipts of s1aughter hogs at
seven 1arge midwestern termina1 markets fai1ed to show any significant
increases in s1aughter—hog market receipts during the 1949-62 period
(Tab1e 9).
The rapid increase in the production and marketing of Tightweight
feeder pigs in the Centra1 Kentucky Area is a ref1ection of the genera1
trend toward specia1ization in the hog industry. A11 the major feeder-
pig producing states have significant1y increased production of 1ight-
weight feeders since 1954. In addition, farmers in the centra1 corn-be1t

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