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Pork Commentary: Russian Road Trip

12 August 2014
Jim Long on ThePigSite

Jim Long is President &
CEO of Genesus Genetics.

RUSSIA - This past week we were in Russia when sanctions were announced stopping many food products from being imported. Included on the banned list was pork from many countries including European Union, USA, and Canada. The ban was announced to be for one year.

In some ways it was not a game changer as Russia had already banned EU pork and live pigs due to African Swine Fever and USA – Canada was shipping little to Russia. Brazil has and will be able to ship pork to Russia.

The previous ban on EU pork has led to quite profitable pork production in Russia as the total pork supply has been cut by about 20 – 25 per cent. How profitable? We were visiting Genesus customers this past week and they told us their profit was $250 per head. The further one year ban of EU pork will lead to very good profits for the next year.

These unprecedented profits for Russian producers will lead to sow herd expansion in the next year. This will push up Russian production towards a goal of self-sufficiency. In the next year there will be opportunities for builders, equipment, and genetic supplies for this expansion.

On breeding stock genetics there is limited supply available in Russia and imports appear to be banned.

Where the breeding stock will come from for the potential expansion could be a real challenge. One thing for sure there are always interesting dynamics that affect the pork industry. Disease, feed costs, and politics all seem to affect the market access and prices. It’s not for the faint hearted. Many factors affect our livelihood and it’s almost impossible to guess what is next?


Being in Russia we have limited access to US market news. Unfortunately what we have seen has been mostly the downside on the US hog market. Lean hog futures down with April – June lean hogs down to 87? - 89? last Friday. April – June are the hogs that are being bred for currently. It’s plus $50 per head less than we got in the same period this year. It appears to us April – June lean hog futures have no factor of ongoing PED disease in the market equation. Too early to tell what PED strikes will be this fall. Even a 3 per cent increase in mortality from PED above normal mortality makes 87? - 89? lean hogs way too pessimistic price in our opinion.

We never expected $1.40 lean hogs in August seemed to us with total pork tonnage not much different year over year, heavier carcass weights was beyond comprehension to reach such a price high. Wish we were wrong. 13 million lean hogs were $114.77/pound last Friday off $30 per head in the last two weeks.

We believe there will be continuing price pressure lower over the next few weeks.

Author: Jim Long, President & CEO, Genesus Genetics

To find out more about Genesus Genetics,
please take the time to visit their website at

The opinions expressed in this commentary are entirely those of the author and can not taken to represent the views of, its owners or its management.

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