Contract hog production involves an agreement between two or more parties. The agreement divides responsibilities for supplying resources such as capital, labor and management. While contracting is not a ,new concept to US agriculture, hog contracting represents a grovring segment of the national hog production industry. The farm crisis ofthe 1980's created an environment advantageous to expansion ofcontract production. For individuals faced with poor livestock returns, debt problems and equity erosion, contractmg provided a method for overcoming the fmancial difficulties and remaining in operation (Ciiristian et al). This paper will focus on the costs and returns Iowa growers encounter when involved in contract hog production. Also examined will be the marketing practices of contractors in the state.
Rummens, Michele; Kliebenstein, James; and Rhodes, V. James, "Investment, Returns and Marketing Practices in Iowa Contract Hog Production" (1991). Economic Staff Paper Series. 220.