Thursday, June 26, 2008

Good Eggs - Bad Eggs

Governor Tim Kaine announced that Westport Corp. will invest $3 million to open an assembly plant in Roanoke. They will take over the 200,000 square foot Smurf-it building to build axles for the Volvo Heavy Truck Plant in Dublin. VA bested WV in competition for the plant that will create 60 jobs. Cock-a-doodle-do!
Corn prices are described as the "silent killer" for the poultry industry which is so important to the economy of the central Shenandoah Valley. Feed makes up 70% of the cost of producing chickens and turkeys. Corn prices have gone from $4.60/bushel at the first of the year to nearly $8.00/bushel recently. Most analysts think the federal mandate for 15 billion gallons of grain-based ethanol is a major reason for the nearly doubling of price. So, in addition to your morning bowl of corn flakes, you can expect to see prices rising for chicken, turkey, and beef too. Thanks Congress and President Bush. CCC has posted on this previously - the basic analysis stands.
The increase in feed prices could lead to job losses. Pilgrim's Pride in Broadway has cut back on egg placements by 5% and they closed a NC plant and let go 1,100 employees.
Coarse cracked corn used to be the low cost ingredient in cheap wild bird food - no more. Gimme some thistle seed.

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