Abstract

Risks associated with independent hog finishing have prompted producers to seek alternative production and marketing methods. A means of reducing risk has developed through contract hog finishing. Research results indicate that risk-neutral producers require contract base payments ranging from $11.25 to $14.00 per head. Strongly risk-averse producers require contract base payments ranging from $4.75 to $7.75 per head. The lower ends of the ranges are for a contract with performance incentives. The upper ends of the ranges are for a flat contract without performance incentives. Calculated required base payments are similar to those payments currently received by contract hog finishers.; Swine Day, Manhattan, KS, November 16, 1995

Keywords: Swine day, 1995, Kansas Agricultural Experiment Station contribution, no. 96-140-S, Report of progress (Kansas State University. Agricultural Experiment Station and Cooperative Extension Service), 746, Swine, Risk management, Contract hog production

How to Cite:

Parcell, J. L. & Langemeier, M. R., (1995) “A comparison of risk and return for contract and independent hog finishing”, Kansas Agricultural Experiment Station Research Reports 1(10), 139-142. doi: https://doi.org/10.4148/2378-5977.6454