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Economist says understand cost of production comparison

A livestock market analyst says it’s important for pork producers to know how their cost of production compares to others in the industry.

University of Missouri’s Scott Brown says producers that want to stay in business long-term will have a better chance of doing so if they are at the low end of production costs.  “Know your own costs,” he says.  “But know where you sit relative to everybody else.  That everybody else might be within your state, your country, or within the world.  As we get more broad – it gets more important to know what cost of production looks like compared to yours as well.”

He tells Brownfield variability in cost of production has narrowed over time.

As for producers that haven’t been able to lower and stabilize their cost of production, Brown says they’ve exited the industry.