Farmscape for June 3, 2021
The Director of Risk Management with HAMS Marketing Services says the return to normalcy in the United States in the wake of COVID is fueling some of the highest hog prices in years.
North American live hog prices, pressured by changing consumption patterns and reduced processing capacity due to COVID, have rebounded dramatically since this time one year ago, driven in part, by the reopening of the U.S. economy.
Tyler Fulton, the Director of Risk Management with HAMS Marketing Services says it's remarkable how the market has been able to recover from a huge shock to the value chain.
Clip-Tyler Fulton-HAMS Marketing Services:
Prices are exceptional right now, would be the best way to describe it.
What we've got is a scenario where carcass prices in the United States are bumping up against all time highs.
As a result, most of the prices that packers, both in the United States and Canada, pay based on are referencing in some way those carcass values and so consequently it's a very profitable time.
We're looking at hog prices that are coming close to 300 dollars per pig and, even with exceptionally high grain prices, producers are still very profitable in Canada, arguably making some of the best margins that they've made in probably eight or nine years.
Fulton recalls processing facilities were running at a fraction of capacity at this time one year ago and faced some of their darkest days because of COVID outbreaks.
He says we are in a completely different place today where we have seen steady uninterrupted processing, especially in the United States.
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