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Articles from 2010 In September

Pork Quality Program Reaches Major Milestone

Pork Quality Assurance Plus (PQA plus) has reached a major milestone – 50,000 producers have become certified in the program that assures the world U.S. producers provide a safe and wholesome product while caring for their animals in a socially responsible manner.

“All pork producers should be especially proud about reaching this milestone,” says Gene Nemechek, a swine veterinarian from Springdale, AR, and president of the National Pork Board. “Producing safe food and providing high-quality care for our animals are two of the ethical principles that form the foundation of the pork industry’s We Care initiative. But it’s one thing to talk about ethical principles and another when we walk the talk,” he says. “This demonstrates that producers are walking the talk.”

PQA was introduced in 1989 to promote food safety and residue avoidance on the farm. The program was expanded in 2007 to include animal handling practices and was renamed PQA Plus.

Producer certification requires meeting with a trained advisor once every three years to review the 10 Good Production Practices that promote pork safety and animal well-being practices.

To achieve site status, a pork operation must have an on-farm assessment of its animal handling practices by an assessor trained by the National Pork Board.

“Getting to the 50,000 certification mark has been a significant undertaking by both pork producers and the ag educators and veterinarians who conduct the certifications,” says Stacy Revels, manager of certification programs for the Pork Checkoff. “The National Pork Board in 2009 set a goal of having all pork producers certified by 2010. And while we’re not quite there yet, this milestone demonstrates the commitment of pork producers to doing the right thing.”

In 2007, 30,000 producers were certified, Nemechek says.

The Pork Board also set a goal of having all operations site-assessed by the end of 2010. “Right now, we have assessed operations that represent two-thirds of all the pigs in the country. We continue to assess new operations each week and are making great progress on our goal,” she says.

Pork producers who have yet to become certified or site-assessed can obtain information about the PQA Plus program by calling the Pork Checkoff Service Center at (800) 456-7675.

National Hog Farmer

Novartis Animal Health US, Inc. to offer eight FFA members grants for the second consecutive year

*Novartis Animal Health is partnered with the National FFA Organization to offer grants in support of Supervised Agricultural Experience projects.

*Eight high school students will be selected to receive $1,000.

*Grants are available in beef, dairy, swine and veterinary medicine.

GREENSBORO, N.C. (September 29, 2010) – In an effort to offer real-world experience to future agriculture professionals, Novartis Animal Health US, Inc., will offer grants to eight high school students of the National FFA Organization as part of an ongoing partnership. Each grant is $1,000 and will provide the students the opportunity to be involved with an animal health-related Supervised Agricultural Experience (SAE) project. SAE projects typically involve research, employment with an agricultural business or an entrepreneurial project in which the student plans and operates an agriculture-related enterprise.

The relationship between Novartis Animal Health and FFA demonstrates the importance Novartis places on supporting youth for the future for all facets of agriculture, especially animal health. Novartis will support SAE projects in the categories of beef production, dairy production, swine production and veterinary medicine.

“Novartis Animal Health has been a sponsor of the National FFA Organization for many years,” said Steven Boren, vice president of farm animal business sales and marketing for Novartis Animal Health and who is serving as a member of the National FFA Foundation Sponsors’ Board. “As the population grows over time and as the demand for food increases, the need to keep young people interested and involved in production agriculture will be critical. The SAE program is excellent for this because students are able to take the notes and lessons from the classroom and apply them to real-world scenarios. By guiding students with these projects, we can help in maintaining the importance of working in agriculture.”

The 2010 SAE grant application period opened on September 1, 2010 and the deadline to submit grant applications is Monday, Nov. 15, 2010. SAE grant winners will be announced in December 2010. To be eligible for a SAE grant, students must be in the seventh through 11th grade during the 2010 calendar year, have an SAE and be a member of FFA. Additional information regarding these grant opportunities can be found on the National FFA Organization website:

Novartis Animal Health will also be stationed at booth 652 at the 2010 National FFA Convention Career Show on October 20-22 in Indianapolis, IN, and students are encouraged to stop by to learn more about the grants offered.

About Novartis Animal Health US, Inc.

Headquartered in Greensboro, NC, Novartis Animal Health US, Inc. researches, develops and commercializes leading animal treatments that meet the needs of pet owners, farmers and veterinarians. Part of the Basel, Switzerland-based Novartis Animal Health global organization, the US business is the largest of the 40 countries where Novartis Animal Health operates. For more information about Novartis Animal Health US, Inc., please consult

About Novartis

Novartis provides healthcare solutions that address the evolving needs of patients and societies. Focused solely on healthcare, Novartis offers a diversified portfolio to best meet these needs: innovative medicines, cost-saving generic pharmaceuticals, preventive vaccines, diagnostic tools and consumer health products. Novartis is the only company with leading positions in these areas. In 2009, the Group’s continuing operations achieved net sales of USD 44.3 billion, while approximately USD 7.5 billion was invested in R&D activities throughout the Group. Headquartered in Basel, Switzerland, Novartis Group companies employ approximately 102,000 full-time-equivalent associates and operate in more than 140 countries around the world. For more information, please visit

About the National FFA Organization

The National FFA Organization, formerly known as Future Farmers of America, is a national youth organization of 523,309 student members (and counting)—all preparing for leadership and careers in the science, business and technology of agriculture—as part of 7,487 local FFA chapters in all 50 states, Puerto Rico and the Virgin Islands. The National FFA Organization changed to its present name in 1988 in recognition of the growth and diversity of agriculture and agricultural education. The FFA mission is to make a positive difference in the lives of students by developing their potential for premier leadership, personal growth and career success through agricultural education. The National FFA Organization operates under a Federal Charter granted by the 81st United States Congress, and it is an integral part of public instruction in agriculture. The U.S. Department of Education provides leadership and helps set direction for FFA as a service to state and local agricultural education programs. Visit for more information.

For more information, contact:

Julie Groce

Novartis Animal Health Communications

(336) 387-1080 (office)

(336) 601-8079 (mobile)


Mickey McDermott

Novartis Animal Health Communication

(336) 387-3924 (office)

(336) 636-1686 (mobile)

USDA Secretary Vilsack Asked to Scrap New Livestock Regulations

In an open letter to Secretary of Agriculture Tom Vilsak, Mark Legan, pork producer from Coatesville, IN, a member of the National Pork Producers Council (NPPC) board of directors and chairman of the NPPC’s Competitive Markets Committee, asks USDA to scrap the Grain, Inspection and Packers and Stockyards Administration’s (GIPSA) proposed rule and start over. Legan wrote:

“Dear Secretary Vilsack,

“I spent seven years as an agricultural Extension agent before starting out in hog farming in Putnam County, Indiana. I sincerely appreciate your efforts to revive rural America. I also attended your recent competition workshop in Fort Collins, CO.

“I have a suggestion, if you really want to entice people back to the rural lifestyle and increase competition in the livestock industry: withdraw the regulations you proposed in June that will result in government – not producers – deciding how livestock are bought and sold in this country.

“In the name of ‘reforming’ meatpacker contracts, these regulations will stifle innovation, eliminate jobs and dictate contract terms in my industry.

“For starters, your rules will make it extremely difficult for producers like me to negotiate premiums for our animals. Let’s say a packer wants me to deliver livestock on a holiday, which would typically require paying my employees overtime. Under the new rules, the packer would be unable to pay me a premium unless the higher price is justified in writing and with a cost analysis.

“Rather than cope with all that paperwork, packers will likely pay just one price – almost certainly the lowest – to all producers, regardless of quality of their animals or any other special circumstances. This will not only lower prices, it will take away any incentive we have to innovate or produce higher quality animals.

“Your draft rules also greatly expand the definition of what constitutes a violation of the Packers and Stockyards Act. Under the new definition, a violation can be almost any practice shown to be ‘unfair,’ whether or not it actually harms competition. That will turn ordinary contract violations into federal Packers & Stockyards (P&S) Act cases and trigger years of lawsuits.

“Rather than face all that, some packers will decide to raise their own livestock and not bother with producers at all. I don’t know about you, but that sounds like a prescription for decreased – not increased – competition in my industry.

“You contend these rules simply fulfill a mandate under the 2008 Farm Bill. In fact, they go way beyond what was called for in the farm bill. Several provisions were either turned down by Congress or run afoul of court decisions. The provision requiring packers to justify price differences in writing, for example, was specifically rejected during the farm bill debate. The change in the definition of a violation under the P&S Act is contrary to numerous federal court decisions.

“If the goal is to limit packer contracts, the new rules will certainly succeed. They will force hog farmers like me into the smaller ‘cash market,’ where risks can be greater. With fewer contracts, producers will find it more difficult to get financing. Some will simply not survive. That will eliminate desperately needed rural jobs and, once again, lead to decreased – not increased – competition in livestock farming. It will also drive up costs, leading to higher retail meat prices and fewer choices for consumers.

“There’s no way I could start out in farming today if these rules were in effect. They are a disaster for pork producers, not to mention an outrageous intrusion into private markets that will eventually affect all Americans. You and the others at USDA need to go back to the drawing board and come up with something better.”

Mark Legan
Hog Farmer
Coatesville, Indiana

The GIPSA proposed rule was published in the Federal Register on June 22, 2010, outlining several new sections under the Packers & Stockyards Act. The comment period on the proposed rule closes on Nov. 22, 2010. Comments may be filed via e-mail to; by mail, hand delivery or courier to Tess Butler, GIPSA, USDA, 1400 Independence Ave. SW, Room 1643-S, Washington, DC 20250-3604; by fax to (202) 690-2173; or via the federal eRulemaking Portal at

Time to Get Annual Influenza Vaccination

Pork producers, farm personnel and others who come in contact with pigs are advised to get the seasonal flu vaccination as soon as possible now that another flu season has arrived, according to the Pork Checkoff.

“It’s always wise for producers and swine farm workers to reduce the risk of getting sick and bringing the flu to the farm or workplace by getting vaccinated,” explains Lisa Becton, DVM, director of swine health for the Pork Checkoff. “Also, it fits perfectly into the industry’s ‘We Care’ approach to protecting employees, animals and public health.”

The influenza vaccine supply is plentiful this season, according to the U.S. Department of Health and Human Services, which is advising that all people over the age of six months be immunized. At-risk groups should consult their physician before getting any vaccination. These groups include pregnant women, people who live with or care for children younger than six months of age, healthcare and emergency medical services personnel and people with chronic health disorders or compromised immune systems.

Becton says other steps should also be taken to reduce the spread of infection among workers and pigs from human influenza viruses. Modify sick-leave policies to encourage workers to stay away from the farm if they are suffering from acute respiratory infections.

“Virus shedding is at its peak when the clinical illness is most severe, but people may remain contagious up to 24 hours after symptoms stop, usually three to seven days,” she says.

Maintaining good building ventilation and good hygiene both help reduce spread of flu viruses.

“To prevent pigs and humans from other species’ influenza viruses, producers also should look at bird-proofing their buildings, protecting feed from birds and enforcing biosecurity practices, such as the use of farm-specific clothing and footwear,” Becton says. Key biosecurity practices can be found at using keyword biosecurity.

“A good Web site to reference for flu-related information is,” Becton adds. The Pork Checkoff has a fact sheet on influenza, “Influenza: Pigs, People and Public Health,” available on their Web site.

Feral Hogs Are Key Topic Of Texas Show Oct. 14-16

Feral hogs will again be a major point of discussion at the San Antonio International Farm and Ranch Show Oct. 14-16 at the San Antonio Livestock Expo & Freeman Coliseum.

“Feral hogs or wild pigs are responsible for millions of dollars of damage annually throughout Texas and are a pest in other states as well,” says Lyle Larson, the show’s originator.

Talks on feral hogs were among the best-attended programs at last year’s show, and are being presented again due to their continued relevance to farmers and ranchers.

Jim Gallagher, AgriLife Extension wildlife specialist for the Texas AgriLife Research and Extension Center in Uvalde, TX, will present two educational programs on feral hogs. The first, “Feral Hogs: Forget the War, Just Win the Battles,” will be given at 4:30 p.m. Oct. 14. The second, “Control of Feral Hogs: Why We Wage War,” will be presented at 5:30 p.m. Oct. 16.

“The concept of fighting feral hogs as a type of ‘warfare’ is appropriate in that you should know your enemy and understand their behavior, as well as know the tools and options available to defeat them,” Gallagher says.

The Oct. 14 feral hog program will offer one-half of a continuing education unit in the integrated pest management category, while the Oct. 16 program will offer one unit in that category.

An additional research update on feral pigs will be given at 3 p.m. Oct. 15 by Tyler Campbell of the U.S. Department of Agriculture’s (USDA) Animal and Plant Health Inspection Service. The program offers one continuing education unit in integrated pest management.

The program also offers dozens of other educational sessions.

Top USDA officials will discuss fever ticks and animal identification, food safety, and renewable energy and energy efficiency financial assistance.

For more information, visit or call (210) 226-1177.

NPPC Seeks End to Trade Limits to Cuba

Lifting trade restrictions to Cuba could triple U.S. pork exports by removing limits on travel and export financing for products shipped, according to an Iowa State University (ISU) report.

The National Pork Producers Council (NPPC) is urging passage of House bill H.R. 4645 that would permit U.S. citizens to travel to Cuba and allow direct transfers of funds from Cuban to U.S. financial institutions for products authorized under the Trade Sanctions and Export Enhancement Act of 2000. The law provides exemptions for agricultural and medical products to the unilateral trade embargo the United States imposed on Cuba after that country nationalized the property of U.S. citizens and corporations.

The House Foreign Affairs Committee is expected to mark up the bill today. NPPC sent a letter in support of the bill on Monday. Senate companion legislation is pending action in the Finance Committee.

According to ISU economist Dermot Hayes U.S. pork exports would expand by $28.2 million once the travel and financing restrictions are lifted. This past year the United States shipped about $13.4 million of pork to Cuba.

A study conducted by Texas A&M University suggests the policy change would create about 6,000 U.S. jobs and that total U.S. exports would climb by $365 million a year.

“Because of its proximity to Cuba – just 90 miles separate the countries – the United States is in position to capture a large share of the Cuban pork import market,” says NPPC President Sam Carney, a pork producer from Adair, IA. “For the U.S. pork industry to remain successful and viable, we need new and expanded market access, and H.R. 4645 can provide that access.”

Last year the U.S. pork industry shipped more than $4.3 billion of pork products, adding about $38/head in value to each hog marketed.

Learn more at

Cargill Opens Sow Innovation Center Located in Kentucky

Cargill Opens Sow Innovation Center Located in Kentucky

Cargill Pork and Cargill Animal Nutrition business units of Cargill, Inc. have joined forces to open the Cargill Sow Innovation Center in Sugar Grove, KY, to support the company’s efforts in animal welfare and pork production.

Research work will focus on maximizing sow lifetime reproductive performance, increasing pig weaning weight and improving pig nutrition, while also developing advanced farm production management tools, techniques and systems.

The facility will incorporate gestation group housing and alternative housing for farrowing.

The center is the result of an extensive $1.5-million renovation that will house 1,800 sows and employ 10 people with expertise in animal nutrition, animal husbandry, sows productivity and data management. The effort will combine Cargill Pork’s expertise in swine production and farm management with Cargill Animal Nutrition’s swine nutrition and feed formulation knowledge.

“Health and welfare of the animals we harvest at our pork plants is important because humanely handling sows and their piglets results in better animals and improved meat from those animals,” states Dirk Jones, president of Cargill Pork. “We’ve worked with Dr. Temple Grandin, noted animal welfare expert at Colorado State University, who has helped us design live animal portions of our facilities, in addition to helping us better understand the importance of proper animal handling.”

Cargill harvests about 10 million hogs annually at its facilities in Iowa and Illinois, establishing it as the fourth-largest U.S. pork processor. The company raises about 2.5 million hogs annually, and purchases hogs from producers throughout the Midwest.

Cargill pork operations employ about 5,000 people.
“This collaboration within Cargill will reinforce our leadership position in animal nutrition and benefit our customers around the world,” states Joe Stone, president of the Cargill Animal Nutrition business.

“Cargill’s new Sow Innovation Center, with its focus on animal welfare, demonstrates our leadership position in, and ongoing commitment to, further improving living conditions for swine that become sources of animal protein for human consumption,” says Mike Siemens, who heads Cargill’s animal welfare efforts. “It is the right thing to do, in addition to being good business.”

Cargill is a privately held company employing 131,000 people worldwide. For more information, visit

Pfizer Animal Health Gets New Health Claim for EXCEDE

The Food and Drug Administration has approved an additional claim for EXCEDE (ceftiofur crystalline free acid) Sterile Suspension from Pfizer Animal Health for the control of swine respiratory disease (SRD) associated with Actinobacillus pleuropneumonia, Pasteurella multocida, Haemophilus parasuis and Streptococcus suis.

“This new claim is another milestone in our commitment to veterinarians to provide tools to better control disease,” says Michael Senn, DVM, manager, veterinary operations for Pfizer Animal Health. “Many pork operations fight SRD pathogens on an ongoing basis. EXCEDE has provided successful treatment to sick pigs and now can be used to control disease in herds with an SRD diagnosis.”

EXCEDE delivers at least seven days of therapeutic plasma levels with a single dose. “This means it starts working right away and continues to provide therapy for an extended period,” says Senn.

EXCEDE is also indicated for the treatment of SRD associated with Actinobacillus pleuropneumonia, Pasteurella multocida, Haemophilus parasuis and Streptococcus suis. The product requires a low-volume dose and comes in 100-ml. size.

EXCEDE should not be given to swine known to be hypersensitive to cephalosporins or penicillins. Following label use as a single treatment, observe a 14-day pre-slaughter period.

Discuss treatment with EXCEDE with your veterinarian or local Pfizer Animal Health representative or visit

Corn Price Advances Dim Hog Expansion Plans

Hog expansion was set to begin this fall – before corn futures hit $5. Those plans may have been appropriate when corn was priced at $3.50 in early July – but not now when prices are considerably higher, says Purdue University Extension economist Chris Hurt.

“Higher corn prices will cut margins over the coming 12 months, but hog producers can now avoid an expansion that would plunge margins deep into the red in late 2011 and 2012,” he notes.

The clear message to hog producers is: Don’t expand and margins will be okay. The other important message is: The next two years won’t be a repeat of the large losses seen in 2008 and 2009, Hurt explains.

So far expansion has not occurred based on the September USDA Hogs and Pigs report. Producers report 2% fewer animals in the breeding herd than a year ago, he says.

The key state in the report is North Carolina, where breeding herd numbers fell 110,000 over the past year. Without North Carolina, the net effect of all other states was close to unchanged, he reports.

One key to expansion is to watch large corporate North Carolina producers. “There is likely little appetite for expansion over the next 12 months that would throw the industry back into losses,” Hurt says.

The number of market animals was down 3% on Sept. 1, which will lead to a reduction in slaughter numbers of 3% in the last quarter this year and down 1% in the first quarter of next year. Fall farrowing intentions were down 1% and will result in unchanged to 1% higher slaughter numbers in the second quarter of 2011.

A modest rise in winter farrowing intentions will produce 1-2% more slaughter numbers next summer; the final quarter of 2011 might see slaughter numbers rise 2-4%, he says.

“Marketing weights dropped below year-ago levels in late August as higher corn prices began to have an impact. Given the expectation for corn prices to remain high for the 2010 crop, it is likely that weights will continue to be down one-half to 1% through next summer,” Hurt predicts.

“This means pork supplies will be down 3% in the fourth quarter this year, down 2% in the first quarter of 2011, unchanged in the second quarter, up 2% in the third quarter and up 3-4% in the final quarter of 2011,” he says.

There are three critical reasons why pork producers won’t repeat the losses of 2008 and 2009 even with corn prices at $5/bu.:

  • Pork producers have adjusted their herds lower such that they can pay $5/bu. for corn and still maintain positive margins;
  • The United States and world economy will continue to recover; and
  • H1N1 won’t deflate hog prices.

The high cost of pork production resulting from high-priced corn has been passed to consumers who are now paying record-high prices for pork. Retail pork prices averaged $3.23/lb. for August, compared with $2.93 in 2008 and 2009, Hurt explains.

“It was a long and difficult adjustment for the industry to reduce production over the past three years, but that is behind us. Now national average hog prices will be high enough over the next 12 months to pay up to $5.50/bu. for corn and still cover all costs. This is a much different situation than in 2008 and 2009 when the breakeven corn price for hog producers was only $2.70/bu.,” he notes.

Hog prices are expected to average about $55/cwt. live weight basis for the final quarter of 2010 with a breakeven corn price of $5.15. A $56 average price is projected for the first quarter of 2011 based on a breakeven corn price of $5.30.

Prices improve to $60 and $57 in the second and third quarters of 2011, respectively, with corn breakeven prices of $6.10 and $5.50/bu. Just a 4% increase in production drops hog prices back near $50 and corn breakeven prices to $4.10, demonstrating how even modest expansion can put profit margins at risk.

“Plans for expansion need to be put on hold for another year until the size of the 2011 corn and soybean crops are reasonably known. World corn inventories cannot be rebuilt on southern hemisphere production this winter. A large crop in the United States and northern hemisphere in 2011 will be required to begin to restore inventories,” he says.

In the next 12 months, producers should avoid expansion, increase feed efficiency and reduce market weights, and margins should remain positive.

Don’t worry about the size of the 2011 crops. “For now, don’t expand, do what you can and leave adjustments to 2011,” he says.

Few Surprises in Hogs & Pigs Report

Friday’s USDA Hogs and Pigs report was pretty much as expected. Table 1 contains the key data from the report, the average pre-report estimates of market analysts, and the differences between the numbers.

The differences between expected and actual numbers are less than 1%, with the exception of the 180-lb. and over category, although the USDA number for that category agrees almost precisely with slaughter levels since Sept. 1.

The market hog inventory and all weight class numbers indicate that supplies will, as expected, remain below year-ago levels for the remainder of this year and for most of Q1-2011. But note that the year-on-year percentages get larger as the weight classes get smaller – an indication that production is catching up to year-earlier levels over time. In my estimates, I have slaughter exceeding 2010 levels by June of next year.

USDA’s breeding herd estimate shows the herd getting smaller by 18,000 head since June 1. That was a bit of a surprise given the low levels of sow slaughter and no clear indication that fewer gilts were being marketed (based on a percent of total barrow and gilt slaughter). The report suggests a small buildup of sow numbers. While actual and anticipated profits no doubt encouraged some herd rebuilding, the risk cast over the hog business by rising feed prices and the proposed Grain, Inspection and Packers and Stockyards Administration's (GIPSA) rule has very likely caused some producers to delay taking action. According to this report, the sow herd is only 10,000 head larger on Sept. 1 than it was on March 1.

USDA revised some of its June numbers to reflect the lower slaughter this summer. Dec-Feb farrowings were lowered by 29,000 litters to 2.872 million and the Dec-Feb pig crop was lowered by 281,000 head to 27.592 million. The June 1 inventory of pigs weighing from 120-179 lb., which was over 5% lower than in 2010 in the original report was dropped by another 250,000 head, to 12.029 million. That 250,000 head is the lion’s share of the shortfall of actual vs. expected slaughter this summer, giving new credence to the beliefs of many that the pigs were never available in the first place.

Key Points in the Report
So what do these numbers mean? Supply and price forecasts appear in Tables 2 and 3, respectively. Note that only the Livestock Marketing Information Center (LMIC) and I have posted their price forecasts at this point. Agricultural Economists Ron Plain at the University of Missouri and Shane Ellis at Iowa State University provided their price forecasts on a media call sponsored by the National Pork Board on Friday afternoon. Neither provided slaughter estimates at that time.

Price forecasts are generally profitable through Q3 of 2011. Q4-2010 and Q1-2011 profit margins will be small based on current corn and soybean meal futures. Q1-2011 profits depend heavily upon next year’s corn and soybean crops.

One interesting side note is to look at where the reductions have taken place. The Sept. 1 breeding herd was 105,000 head smaller than one year earlier. During that year, North Carolina’s breeding herd shrank by 110,000 head and Texas’s herd shrank by 15,000 head. Minnesota and Nebraska lost 10,000 sows. The largest gainers were Kansas and Illinois with 20,000 more sows and Pennsylvania gaining 15,000.

Texas and North Carolina also saw the largest declines in market hog numbers at 605,000 and 590,000, respectively. Iowa’s market herd fell by 400,000 during the year. Illinois and Kansas led the market herd gains at 130,000 and 60,000 head, respectively.

Canadian Hog Import Data Still Lagging
There is good news and bad news regarding the Canadian hog import data. The good news is that the Agricultural Marketing Service (AMS) and Animal & Plant Health Inspection Service (APHIS) have the new data base up and running and we have some data for the weeks since July 7. The bad news is that the latest data is, at present, for the week of Aug. 28. I’m sure they will get current someday – hopefully soon.

Click to view graphs.

Steve R. Meyer, Ph.D.
Paragon Economics, Inc.