, Volume 190, Issue 1, pp 271-287

An integer programming model for optimal pork marketing

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Abstract

Pork producers must determine when to sell pigs, which and how many pigs to sell, and to which packer(s) to sell them. We model the decision-making problem as a linear mixed-integer program that determines the marketing strategy that maximizes expected annual profit. By discretizing the barn population into appropriate weight and growth categories, we formulate an mixed-integer program that captures the effect of stocking space and shipping disruption on pig growth. We consider marketing to multiple packers via shipping policies reflecting operational sorting constraints. Utilizing data from Cargill Animal Nutrition, we implement the model to obtain solutions that characterize significant strategic departures from commonly-implemented industry rules-of-thumb and that possess the potential to increase profitability in an industry characterized by narrow profit margins.