What is the ratio of feed?
In the finances, the ratio of feed is a measure of profitability increases in livestock calculated by dividing the price of an animal by the price of food required to increase it to market weight. The ratio is important to the futures markets because it can act as a predictor of livestock supplies. If farmers expect a high profit from investing their maize offer in farming animals, it is more likely to expand their economic economy. This, in turn, reduces the ratio because the expanding delivery reduces the price of animals. Thus, the ratios of feed support cycles that characterize the animal markets, by shaping the expectations of farmers about profit. The value of the measurement depends on the relative stability of the other costs of increasing livestock. This assumption is not entirely accurate, the bpometers of the UT feed are widely accepted on the futures markets on livestock.
In practice, feed ratios are based on approximationanimal prices and feed. The price of an animal is not always the most important price, as markets focus on usable parts of livestock. It would be impractical to watch food fed to every animal and would be difficult to predict. This practice would also bring individual conditions, which would not be useful for the industry as a whole. There are conventional approximations for accurate feed ratios that provide useful information about the market for livestock.
One variation on the traditional feed ratio is to replace the price of an animal at the cost of a commodity produced by livestock. This is useful in industries that do not rely on direct sales of animals. For example, egg feeding and feed feeding are often mentioned.
variations is to replace the price of the feed by a representative, because the feeding procedures of farmers and animal consumption differ in individuals. One commonly referred to the feed ratio is the ratio of Hog-Corr. It is located by distributing the price of £ 100 (45.4 kg) of the pig's meat price by one BI earn (35.2 liters) corn. The price of corn is a useful representative because corn represents most of the feed. Corn is also a highly liquid commodity, so the price of maize can affect the decision to increase livestock, because the sale of maize is a viable alternative.