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Economies of Size in Hog Production

Author

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  • Van Arsdall, Roy N.
  • Nelson, Kenneth E.

Abstract

Large hog operations achieve economies of size over small hog operations through more intensive use of facilities, somewhat better feed conversion, lower feed costs, and lower unit labor use. Economies of size are large enough that in a year of low returns, some small enterprises may fail to cover cash costs, while larg9 enterprises cover all costs, including capital replacement. Large producers' advantage is less when only shortrun cash costs are considered; as the planning period increases, so does the large producers' advantage. This report discusses economies of size in numerous aspects of hog production: inputs and costs, investment3 in depreciable assets, returns, income taxes, and physical, price, and economic performance measures in the North Central and Southeast regions, the major U.S. hog-producing areas.

Suggested Citation

  • Van Arsdall, Roy N. & Nelson, Kenneth E., 1985. "Economies of Size in Hog Production," Technical Bulletins 157010, United States Department of Agriculture, Economic Research Service.
    • Handle: RePEc:ags:uerstb:157010
    DOI: 10.22004/ag.econ.157010
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    File URL: https://ageconsearch.umn.edu/record/157010/files/tb1712.pdf
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    Cited by:

    1. McBride, William D. & Key, Nigel D., 2003. "Economic And Structural Relationships In U.S. Hog Production," Agricultural Economic Reports 33971, United States Department of Agriculture, Economic Research Service.
    2. Rowsell, John B. & Kenyon, David E., 1988. "Target-MOTAD: A Stochastic Dominant Method For Evaluating Alternative Profit Margin Hedging Strategies," 1988 Annual Meeting, August 1-3, Knoxville, Tennessee 270146, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    3. Halverson, Marlene K., 1991. "Farm Animal Welfare: Crisis Or Opportunity For Agriculture?," Staff Papers 13979, University of Minnesota, Department of Applied Economics.
    4. Jahae, Ilona A.M.A. & van Staalduinen, Lanie C., 1992. "Application Of Input-Output Methodology For Local Community Impact Analysis: Swine Production In Redwood County, Minnesota," Staff Papers 13668, University of Minnesota, Department of Applied Economics.
    5. Thulin, Andrew J. & Schwab, Gerald D. & Hilker, James H., 1987. "The Shape of the Swine Production Industry Today and Tomorrow," Staff Paper Series 200928, Michigan State University, Department of Agricultural, Food, and Resource Economics.

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