hog-corn ratio investment & finance definition

A ratio that is used to express the relationship of feeding costs and the dollar value of livestock. The ratio is measured by dividing the price of hogs (as calculated by the dollar per hundredweight) by the price of corn, which is calculated by the dollar per bushel. When corn prices are high in relation to pork prices, fewer units of corn equal the dollar value of 100 pounds of pork. Conversely, when corn prices are low in relation to pork prices, more units of corn are required to equal the value of 100 pounds of pork. Because corn is a major cost for hog producers, higher pork prices and lower corn prices signify more profits in feeding hogs.