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WPX: Genesus' Jim Long on Global Hog Prices, Market Drivers

09 June 2016

ANALYSIS - Jim Long, president at Genesus, speaks about global swine prices and industry drivers at the 2016 World Pork Expo in Des Moines, Iowa, USA.

Jim Long, president at Genesus, speaks to ThePigSite.com's Sarah Mikesell at the World Pork Expo in Des Moines, Iowa, USA. 

"The biggest dynamic right now in the world is what's going on in China," Long said. "The massive liquidation last year to the last year-and-a-half of 11 million sows is driving prices up to a level that's creating profitability there of $160 to $180 per head. It's pulling more pork to China, which is supporting the North American and European markets."

Europe, on the other hand, is seeing big challenges for profitability. The EU pig industry has lost a significant amount of money and seems to be somewhat in recovery now.

Russia was expected to see a lot of expansion this year, but it has been delayed due to ruble devaluation, he said.

"It's just the level of loans available due to the liquidity of banks," he said. "The industry itself is making money in Russia, but it's a challenge for producers to expand."

North America and Canada are seen in a holding pattern.

"There's no expansion there that we see of any significance, but in the US, we're starting to see the beginning of an expansion," he said. "Profitability in both countries is between $20 to $30 per head, which over the last 10 years is good historically for that time period for profitability."

Mexico continues to have big challenges with porcine epidemic diarrhea virus (PEDv) in the central part of the country where they are seeing high pig mortality. Last fall, there were expectations of a significant expansion in Mexico, but any expansion plans were put on hold when prices weakened through the winter months.

Regarding PEDv impact in Canada and the US, Long said there are PEDv breaks in Canada and the US, but the amount of damage being caused from it is not a market mover.

"PEDv hurts individuals, but it isn't of a significant level that it will affect the prices," he said.

 

Sarah Mikesell, Senior Editor

Sarah Mikesell, Senior Editor



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