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High Demand Pushes Up Live Hog Prices

by 5m Editor
8 May 2008, at 7:24am

CANADA - Despite continued high levels of production and high volumes of pork in storage live hog prices in western Canada have risen dramatically over the past few weeks, writes Bruce Cochrane.

Canadian hog slaughter numbers have increased by almost one percent compared to the same period a year ago while in the United States slaughter numbers have averaged over 2.2 million head per week over the past eight weeks, up about eight percent from a year ago.

Brad Marceniuk, a livestock economist with the Saskatchewan Ministry of Agriculture says, while slaughter numbers continue to be high, the current seasonal demand for pork and strong exports have pushed hog prices upward.

Brad Marceniuk-Saskatchewan Ministry of Agriculture

At the present time live hog demand in the United States is up about eight percent which is the main factor for increasing hog prices and we've also seen a big strong increase in pork exports in the world.

Based on lean hog futures prices index 100 hogs for western Canada could average in the upper 130's for the second quarter and could average in the mid 130's for the third quarter.

Live hog demand and strong pork exports will be key factors sustaining these current prices at these current high production levels.

The rate of North American sow liquidation and weekly U.S. hog slaughter numbers will continue to be important factors in stimulating higher pork prices and for sustaining longer term price improvements.

While demand has improved prices in the short term, production to date has not reduced significantly to signal if prices will remain strong at these levels into the fall.


Marceniuk notes stocks of beef in cold storage have been relatively unchanged but pork and poultry stocks have increased in the range of 30 percent year over year and, while storage stocks have not impacted live hog prices to a large degree in the short term, if these stocks remain high we could see price pressure into the third and fourth quarters.

However he notes we have seen some sow liquidation in Canada and the U. S. and, as we see more sow liquidation, we'll see reduced production which would help push prices up further in the longer term.

5m Editor