Pork Producers Expected to Remain Profitable Into 2015

US - Despite the recent slide in live hog prices North American pork producers are expected to remain profitable well into 2015, writes Bruce Cochrane.
calendar icon 11 September 2014
clock icon 3 minute read

Live hog prices have fallen steadily since hitting their peak in mid-July. Dr Ron Plain, an agricultural economics professor with the University of Missouri, notes record high retail pork prices have slowed pork sales at a time of year when the number of hogs available for slaughter goes up, fueling a sharp decline in both pork and hog prices.

Dr Ron Plain-University of Missouri:

Seasonally we're going to continue to see increases in pork production. It's just a seasonal business.
We slaughter more hogs on a daily basis in the fall than we do in the summer, so pork production is headed up.

We also, though, expect fairly sharp declines in retail prices.That should boost the amount of pork that's moving through grocery stores and the demand for pork and so we're right now sort of expecting we might see a bit of a bounce off of the lows we've had in the last few days in hog prices as we see hopefully demand start to pick up a bit.

We were looking at record profits, over 100 dollars per head in mid-summer for hog sales. We're down under 50 dollars per head now.

We're still profitable and expect to remain so for the rest of this year and well into 2015 but we're probably going to spend more time in the range of 25 to 50 dollar a head profit than in that 75 to 100 dollar range we were for awhile this spring and summer.

Dr Plain says it looks like a record corn harvest will keep production costs down and US pork exports have been going well.

He says Hong Kong, Japan and Mexico have been strong buyers and hopefully we'll continue to see strong foreign demand.

Charlotte Rowney

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