MASON CITY - A new online service to link buyers of pigs with sellers, and renters of hog facilities with those with empty buildings, is going active this month.
"This is an idea that's way past its time," said Steve Weiss, president of ePigFlow, based in Mason City. "We know of no other service like this. There are auction services for equipment and cattle, but not for swine."
Think of it as eBay for pigs, or Craig's List for facilities.
-Messenger photo by Larry Kershner
Steve Weiss, president of ePigFlow, a new online clearinghouse to link pig buyers with sellers, explains how the service will work. The service works like eBay for the feeder pig industry.
Weiss, a former chief financial officer for Iowa Select Farms, said ePigFlow assists pork producers with two key requirements for a successful operation. They are:
A robust pig-flow model that carries a producer through the financial peaks and flows created by various things such as market fluctuations and diseases.
A method for buying/selling or renting/leasing available swine facilities.
"This is designed as a one-stop shop for asset utilization," Weiss said.
The basic idea is that pig buyers and sellers sign onto the service. Signup is free.
A buyer can see who has pigs for sale and the asking price. The buyer posts a bid and the seller can either accept or counter bid. The process continues until the pigs are sold or one of the parties breaks off the discussion.
If they enter into an agreed sale, the buyer pays the money up front to ePigFlow, which places the funds in an escrow account. The pigs are shipped within a few days of the escrowed payment.
When the shipment arrives, the buyer uses a provided form to note any discrepancies in the pigs and determines a discount. The seller either agrees to the discount, or rejects it.
If accepted, the buyer is sent the discounted amount, and the remainder goes to the seller, minus a handling fee for ePigFlow.
If the seller contests the discount form, ePigFlow will send a field specialist for dispute resolution. The seller will determine if the discount is justified or not.
Weiss said the service is totally transparent. The buyer and seller both know who they are. Their transaction histories will be available for others to see. A seller can see how often the buyer has discounted pigs, or a buyer sees how often seller's pigs were discounted.
Over a period of time and multiple transactions, both sides will get to know with whom they want to do business and whom to avoid, Weiss said.
Another part of the service is a close-out survey for the buyers to show how well the pigs fared when shipped to market.
Weiss showed his new service to pork producers at the 2013 Pork Congress on Jan. 23 and 24 in Des Moines.
He said the service was announced at a Minnesota swine exhibition earlier in January, and expected it would go active this month.
Fees will be assessed on a per-pig-shipped basis on a sliding scale depending on how many pigs are being traded. Sellers and buyers can develop long-term contracts for hundreds of thousands of pigs. For such large volumes of sales, the per-pig fee is down to pennies. Other trades can be upward to 50 cents per head.
The company is a division of Value Added Science and Technologies, based in Mason City, of which Weiss is also president.
"We don't think of ourselves as a source (for feeder pigs)," Weiss said, "but more of a solutions provider."