Farmscape for February 7, 2018
Hams Marketing Services says increased competition in the U.S. for slaughter hogs is resulting in a greater share of the consumer's dollar going into the pockets of farmers.
Moving toward the second quarter of 2018 hog markets have been looking quite positive.
Tyler Fulton, the Director of Risk Management with hams Marketing Services, says slaughter hog numbers have been higher than one year ago but there's more competition for those hogs so the market has been quite firm.
Clip-Tyler Fulton-hams Marketing Services:
Packers have been pretty aggressive with securing their hogs, the uncommitted supply and that's been to the benefit of producers across North America.
For most of the month of January we saw actual hog supplies come in under what was expected.
Generally the market was expecting two to two and a half percent more hogs and for most of January we were actually only up marginally more than one percent.
The most recent slaughter week may have made up for a portion of that.
We were actually five percent higher than the same week one year ago so there's always a kind of a give and take from week to week.
In general I think we're fairly similar to what expectations were and that is roughly about two percent growth over last year in terms of hog numbers.
What we've seen is a narrowing of the spread between wholesale pork prices and what packers are willing to pay for live hogs and so the result of that, really I think in large part due to the increased competition in the market due to the new plants, is more of the consumer dollar ending up in the farmers' pocket.
Fulton says domestic demand for pork remains fairly solid but expected higher beef and chicken supplies might result in some consumer resistance to the higher prices we've come to expect for the summer months and there's a question whether growth in the export market can be maintained at a rate needed to keep pace with the growing supply but no huge disruptions are expected.
For Farmscape.Ca, I'm Bruce Cochrane.
*Farmscape is a presentation of Sask Pork and Manitoba Pork