2016 A Tough Year For Livestock Producers

I think it is safe to say most livestock producers will be happy to put 2016 behind them. It was a very tough year for dairymen, pork and cattle producers. All 3 livestock segments saw substantial losses in 2016. The only livestock segment that had an "ok" year in 2016 was turkey producers according to Steve Olson Executive Director of the Minnesota Turkey Growers.

Livestock losses was one of my Top Ag Stories for 2016. Ag Analyst Kent Thiesse from Lake Crystal said in 2016 indications are that pork producers finishing hogs lost about $30 to $40 on every pig. Most dairymen need about $18 a hundred for milk to break even and most of 2016 milk was $2 to $3 a hundred weight below that. Cattle feeders or finishers lost around $100 to $300 a head. Cow calf producers saw the price of calves drop 40 to 50 percent from the end of 2015.

Losses would have been much worse for livestock producers but feed costs have been quite low. Because of very good yields the last couple years, the price of corn and soybeans are low too. In fact the price of corn and beans are well below the cost of production for most corn and soybean growers too. What is the old saying "misery loves company?"

The financial stress amoung farmers varies depending on their cost structure, equity and marketing. At times there were opportunities to lock in some prices that may have been slightly profitable or at least minimuized losses. Times like these are very hard on young farmers that have not built up a lot of equity, or farmers servicing a lot of debt. Hopefully 2017 will be a better year for farmers!