Jim Long Pork Commentary: random observations from the swine industry

Jim Long provides a rundown of observations from the swine industry to counterbalance the ongoing coronavirus commentary.
calendar icon 19 March 2020
clock icon 4 minute read

Our farmer logic

US lean hog prices rising, USDA cut-outs increasing, US pork exports at record level and European Pork is more expensive, while hog prices in China are at levels beyond normal comprehension. Sounds like a recipe to bake a happy cake?

Not so fast…

We have lean hog futures

  • They have collapsed despite many positive market directions.
  • Lean Hog Futures based in Chicago - (Las Vegas with no rules) seems to create instant negativity in our industry.
  • No other hog-producing country in the world has lean hog futures except the US.
  • 92 percent of the world hog industry seems to have managed to operate without lean hog futures.
  • From what we can see every other country has higher hog prices than the US (Canada).

Quite the system, Canada is the wagging dogs’ tail of the US futures and pricing system.

Last time we wrote about our observations of the effect lean hog futures we got more response comments than any time over the past twenty years of writing. All supportive of the observations except one.

We know that nothing will change: lean hog futures will continue as long as money flows into them and there is a whole industry of brokers and agents collecting commissions on the activity with an obvious vested interest to perpetuate the current system.

To summarise

  • US hog price rising.
  • US pork cut-outs rising.
  • US pork exports - record level - including China.
  • European hog prices - near or at record levels.

Jim Long

President - CEO at Genesus Genetics
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