Monday, September 29, 2014

Hog cycle alive and boding ill

Record-high hog prices and profits are fuelling a huge herd expansion.

“Nearly every measure of the herd now and of expectations for growth in the near future came in higher than was expected,” says Meatingplace Magazine of the latest government survey results.

“As far as the industry’s concerned, they’re making money so one would expect farrowings to increase,” says agricultural economist Ron Plain of the Unviersity of Missouri.

“We were expecting hog farmers to make money, expand production and get more litters,” he said.

“The long-term health situation will determine how many more hogs we actually have,” Plain said, referring to Porcine Epidemic Diarrhea virus which killed about eight per cent of piglets born in the U.S. last winter and spring.

Whether the United States can stop the spread of the deadly virus this fall remains an open question.

If all of the expanded herd and offspring survive, there will be tremendous downward pressure on hog prices.

The hog cycle is alive and boding ill.