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Optimal Hog Marketing Weights. James Mintert, Ph.D. Professor Department of Agricultural Economics Kansas State University. Hogs Have Been Getting Heavier for A Long Time. Why Have Weights Gotten Heavier?. Technology Genetics Feeding regimens BECAUSE IT’S PROFITABLE.

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### Optimal Hog Marketing Weights

James Mintert, Ph.D.

Professor

Department of Agricultural Economics

Kansas State University

• Technology

• Genetics

• Feeding regimens

• BECAUSE IT’S PROFITABLE

• Three keys to examining impact of weight

• More pounds

• Sort Loss

Goal is to maximize profits

• Determine marginal revenue for a weight change

• Determine marginal costs for a weight change

• Maximize profit when

Marginal revenue = marginal cost

At each weight

• Estimate base carcass value

• Estimate expected sort loss

• Estimate expected lean premium

• Base + sort + premium =

Exp. Net Carcass Value

Calculate revenue gain for additional pound of gain

• Pounds of feed per lb. of gain

• Increases as weight rises

• Feed cost per lb.

• # of feed X cost/lb = marginal cost

Profit Is MaximizedWhen Marginal Revenue Equals Marginal Cost

• Use your kill sheet data to estimate relationship between weight and

• Sort loss

• Use models to predict sort loss and lean premium at each weight

• Calculate expected marginal revenue for a one lb. weight gain

• Estimate your marginal costs

• Know your costs

• Key is feed costs

• Pounds of feed per lb. of gain

• Cost per lb. of feed

• Other variable costs per lb. of gain

• Compare your expected marginal costs to your expected marginal returns

• Profit Max occurs when MR = MC