Analysts Forecast Looming Crisis

Chicago University press Medhill Reports, says that industry-wide losses may total $3.5 billion in 2008, or about 25 percent of the total value of production, according to agricultural economists.

Despite a recent rebound, hog prices averaged only $39.50 on a live weight basis in the first quarter of 2008 and prices may average $45 for all of 2008 compared with $47.09 in 2007, which was the lowest level since 2003, according to an economic outlook published jointly by the Department of Agriculture Economics, Purdue University, and University of Illinois at Champagne-Urbana.

Record high production costs, including the cost of corn feed, have pressured hog farmers, forcing some to sell off, or liquidate their herds, thereby increasing pork supplies and pushing prices lower.

From the February 4 high of $81.05, the most-active June lean hogs contract at the Chicago Mercantile Exchange fell 18 percent to $66.60 on April 4. Prices have rebounded 6 percent since then, closing Wednesday at $70.70.

Analysts observed that the recent rebound in hog prices was due to increased protein exportation to countries like China and Russia, but warn this trend may not be sustainable throughout 2008.

ThePigSite News Desk

Sign up for our
regular news updates

Latest Pig Industry News

•   APAS Calls for Change to Better Reflect Origin of Food Labelled "Product of Canada"
•   Fujian Boosts Quality Inspection
•   Help Needed for Surviving Livestock of Cyclone
•   RSPCA Takes Pig Action into the Classroom
•   Manure Management Webcast Coming Soon
•   Rapid On-farm FMD Test Available
•   EPP Congress 2008
•   Sponsored Walk and Climb
•   Pork Producers Get Voice On EPA Panel
•   Pork Futures: Hogs Settle Mostly Firm