On a recent episode of The Beginning Farmer podcast, the topic was whether it is possible to break even raising pigs on a small scale.
The answer to that question is yes, of course, as long as the emphasis stays on the word “possible.”
When we had pigs processed in the fall we didn’t set our prices until we had all the costs identified. We knew exactly what it had cost to us raise the pigs (exclusive of labor–a farmer’s labor having no value in the marketplace). So we were able to set our prices based on our cost of production. As long as we sold all the pork, we knew we wouldn’t lose money.
Of course farmers who raise their pigs as we do, on pasture with a GMO-free diet and no growth hormones or antibiotics, can’t compete with the price of industrial pork. Last year the industrial pork industry had record profits, thanks to lower feed and fuel costs and a booming export market. Their all-time record profits amounted to $84/pig. For a small farm like ours, $84/pig won’t get the bills paid. But if you have hundreds of thousands of pigs, then that’s real money. Smithfield alone has over 1 million sows, who live their entire adult lives in 7 foot by 22 inch metal crates where they will have an average of 8 litters of piglets before being slaughtered. There are over 10 piglets per litter in the industrial operations, and a sow will farrow 2.2 times per year. So that’s a lot of 84-dollars.
For farms like ours to be economically sustainable, we depend upon customers being willing to pay the true cost of humane and natural animal husbandry.
I used to be less careful about pricing that I should have been. We would set our prices based upon prices at the grocery store. A farmer/friend told me that when we sell our products for less than the cost of production we are essentially paying people to eat our food, as well as underpricing and thereby hurting the other sustainable farmers who are trying to make a living. What he said made perfect sense and we’ve tried to be more careful since then.
We had our annual farm retreat last Sunday–meaning Cherie and I spent five hours at a table analyzing and reviewing how things went last year. We don’t yet have final numbers on pork, since we still have two pigs in the pasture, but the egg results were interesting.
We produced over 600 dozen eggs last year and generated a net profit of $40.51. I suppose that proves it is possible to break even on egg production too. But I wouldn’t want to have to try to make a living as an egg farmer.