Pork Demand Fuels Dramatic Improvement in Cash Hog Prices

US - The Director of Risk Management with h@ms Marketing Services credits a dramatic turn around in cash hog prices to phenomenal export demand for US pork, Bruce Cochrane reports.
calendar icon 11 May 2017
clock icon 3 minute read

Over the past two weeks the US cash market for hogs has recovered dramatically.

Tyler Fulton, the Director of Risk Management with h@ms Marketing Services, says following a counter seasonal decline over March and April, we've seen a surge in cash prices fueled by increased pork demand that has recovered most of the declines.

Tyler Fulton-h@ms Marketing Services

On the export side the increase in demand is fairly widespread.

The latest USDA export sales numbers from March suggest that exports to Mexico were up close to 30 per cent, exports to Japan were up two percent, South Korea were up over 20 per cent so some of the major markets that the US relies on are really the primary driver of this recent run up.

Across all markets US exports were up about 25 per cent year over year, which is exactly the kind of numbers which is the gains that we need to see in order to deal with the sheer volume of pork that the US is producing now and going into the future.

On the domestic side evidence suggests that things are really solid there as well.
I think it's very helpful that the cattle market and the beef market has been extremely strong over the last month or so.

From a retailer standpoint there's not a lot of cheap alternatives or alternatives that are trending in the downward direction that would lead one to put more emphasis on selling beef over pork.

Mr Fulton says the typical seasonal tightening of US hog supplies has contributed to the run up in the cash market but that would likely not have happened if we didn't have what looks to be phenomenal export demand for US pork.

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