Higher US Pork Production Increases Importance of Exports

24 April 2017, at 12:00am

US - EMI Analytics says expanded hog US processing capacity and higher slaughter hog numbers will make continued access to export markets even more critical to keep on top of increased supplies of pork, Bruce Cochrane writes.

The USDA's March Hogs and Pigs report indicates slaughter hog numbers this fall will be even higher than one year ago however new processing capacity coming on line in the US is expected to help keep pace with that expanded production.

Dr Steve Meyer, the Vice-President Pork Analysis with EMI Analytics, says, given those increased supplies of pork, the export market will become even more important.

Dr Steve Meyer-EMI Analytics

We think the export markets are going to remain critical.

They're critical to US pork producers anyway.

We export, over the last few years, anywhere from 21 to 23 per cent of our production.

That's been the reason for strong markets in our opinion.

Since November, a surge in exports, January and February were both up more than double digits, as a matter of fact 18 per cent year to date to the end of February and the weekly data for March would say that pace is continued.

We'll get those data the first week of May so exports have been critical.

They're going to continue that way.

The domestic market here in the United States grows, by population by seven to eight tenths of one per year.

We're back to more than 50 pounds per person per capita availability now and historically we've not been able to push that number much above 52 and so I don't think there's a home for all this extra pork in the United States so exports are going to be critical.

I don't think there's any way we can keep up this plus 18 per cent pace of the first two months of this year but it's going to be critical that we expand those and that brings all the trade situations into question that are in the news at this point as well.

Dr Meyer says, while there's been a lot of talk about potential changes to US trade policy, nothing has changed so any market impact has been minimal.

He acknowledges trade is a major point of market uncertainty and the pork industry has a lot at stake so whether things turn out positive or not is yet to be seen.

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