MISSISSIPPI STATE -- Federal relief is on the way to small hog producers who managed to survive the 1998 market catastrophe.

Mark Crenshaw, swine specialist with Mississippi State University's Extension Service, said the assistance comes too late for many of the state's smaller producers who opted out of the business months ago. The U.S. Department of Agriculture estimateed there are 100,000 eligible producers, but Crenshaw said Mississippi may have 50 qualified farms.

"Eligible farmers can receive $5 per slaughter-weight hog for up to 500 hogs. The maximum any farm will receive is $2,500," Crenshaw said. "Most recipients will be smaller, independent farmers who rely on the money from hog production for supplemental income, not their primary source."

The assistance is only available to producers who sold fewer than 1,000 market hogs during the last six months of 1998. Producers who market hogs under fixed-price or cost-plus contracts and any operation whose gross income was greater than $2.5 million will not be eligible for payments.

Crenshaw said farmers can apply for the aid from Feb. 1 through 12 in the local offices of USDA's Farm Service Agency. Potential recipients should contact FSA offices for eligibility information.

"The payments of $5 per head certainly won't make up for the losses incurred in late 1998, but it will help," Crenshaw said. "Some of the losses were as high as $50 to $60 per hog."

Mississippi agricultural economists estimated the state's 1998 hog industry to have a 24 percent decline in farm-gate value from the previous year. The state's hog production was valued at $45 million in 1998.

Dr. Charlie Forrest, Extension market specialist, said the break-even price for marketing hogs is about 40 cents per pound.

"You have to go back to the 1950s or '60s to find hog prices as low as they were at some points in 1998," Forrest said. "Prices for market hogs were as low as 8 or 10 cents a pound, which means you could buy a hog ready for slaughter for $20 to $25."

Crenshaw said producers were not simply "not making money," they were paying for the opportunity to raise hogs.

"About a third of Mississippi's independent producers have recently gone out of the hog business or are on the way out, and most will not return," Crenshaw said. "Mississippi's percentage of closures is slightly higher than the national trend because of feed costs and lack of market accessibility."

While prices in the first weeks of 1999 have improved as much as 20 cents per pound, Crenshaw cautioned producers from feeling too much optimism.