With the recent closing of the Peoria Union Stockyards, livestock producers lost the last major open outcry auction of livestock in Illinois. While most hogs and cattle these days are sold by contracting directly to packers, livestock producers like Brian Duncan of Ogle county could use the sale prices at Peoria to determine if they were getting a fair market price for their animals.
Today, Duncan markets up to 70 thousand hogs a year. He is paid by the processor by what is called ‘formula pricing’. The price is set by what the packers have to pay other producers for their hogs. Duncan says these prices are reported, but without the open outcry markets like Peoria, where supply and demand determined prices, livestock producers often wonder if they are getting fair compensation for their animals.
While Duncan says raising hogs can still be profitable, barring disease outbreak or other production problems, todays lack of marketing opportunities through stockyards like Peoria can make it difficult for small, startup operations to get into the livestock production business.