Farmscape for March 16, 2005  (Episode 1750)

Sask Pork says continued strong demand for pork, a stable North American meat market and stable US slaughter numbers will be key to maintaining strong live hog prices during the remainder of 2005.

SPI index 100 hogs are currently ranging from 133 to 143 dollars per 100 kilograms...down 10 to 20 dollars from last week's pool price.

Sask Pork Industry and Policy Analyst Brad Marceniuk says, over the last two weeks, hog prices have taken a roller coaster ride.

Clip-Brad Marceniuk-Sask Pork

The US hog market, both cash and futures, initially reacted positive to the announcements that the US border would remain closed to Canadian cattle and that the United States Department of Commerce imposed a final dumping duty of 10.63 percent down from 14.06 percent in October.

Since the end of last week the US hog market has dropped about 15 percent from last week's highs.

We believe that part of this drop is due to the market over reacting on last week's announcements and also the market realized that Canadian live hogs entering into the United States are actually not injuring the US hog industry.

While hog prices have dropped over the last few days, prices are expected to rebound in the second quarter of 2005.

Based on the lean hog futures market, Saskatchewan index 100 hogs are estimated to average about 155 to 165 dollars per 100 kilograms in the second quarter of 2005 and 140 to 150 dollars per 100 kilograms in the third quarter of 2005.

To achieve continued strong North American hog prices we will need to see continued strong demand for pork.

We will also need to see a stable North American meat market with no large fluctuations in meat supplies and also continued US slaughter numbers to be under two million head per week.

Marceniuk says, in Canada, the fluctuating exchange rate and changing basis levels, which are influenced by the antidumping duty, will determine where Canadian hog prices go in 2005.

For Farmscape.Ca, I'm Bruce Cochrane.

       *Farmscape is a presentation of Sask Pork and Manitoba Pork Council