A new financial settlement approach to stabilize profitability of pig production

Abstract

This article proposes and evaluates a new solution that ensures the profitability in short and medium terms and stability of the operations of pork livestock producers through improved risk management An innovative tool for distributing the surplus between producers of piglets and finishers is presented. Manuals on pig farming and data combined from multiple sources were used to assess the current market situation, design a profit stabilization tool for pig producers, and evaluate the performance of this solution. We found that implementing the tool reduces the profits variability of finishers and piglets producers by 45% and 30%, respectively, while keeping the long-term average of profits constant.