(Reuters) — U.S. pork production is likely to decline about two percent this year due to the spread of porcine epidemic diarrhea, or PED, the U.S. Department of Agriculture said in its monthly livestock outlook report.
Live hog prices were expected to increase as a result of the pig virus, the report said.
As of March 1 the U.S. hog herd was at 57.048 million head, 3.7 percent lower than a year ago with losses largely attributed to PED, USDA said.
PED was first confirmed in the United States in May 2013. The pig virus has since spread to hog farms 30 U.S. states and industry analysts estimate six million to seven million pigs have died in the U.S. due to the virus.
The pig virus is also present on hog farms in four Canadian provinces and several areas in Mexico.
PED caused significant losses of pre-weaned piglets in the December-February pig crop, lowering the pigs per litter rate by 5.5 percent to 9.53. USDA expects PED to also negatively impact the March-May pig crop and cause declines in the pigs per litter rate, the report said.
USDA sees slaughter-ready hog prices increasing by eight percent to ranged between $73 and $79 per cwt in the third quarter. Tight supply of pigs will lower slaughter numbers and reduce pork production but heavier weight hogs are expected to partially offset the pork product decline, USDA said.
USDA also expects fourth quarter hog prices to increase by 12 percent to range between $67 to $73 per cwt and sees heavier weight hogs again offsetting the expected declines in slaughter numbers.
U.S. pork exports will likely decrease while pork imports will increase due to reduced domestic pork production, the report said.
U.S. pork exports in 2014 were seen at 4.85 billion lbs, down 2.8 percent from the previous year. While pork imports were seen at about 915 million pounds, up 4.1 percent from 2013.
USDA said some foreign consumers will buy less U.S. pork than they did in 2013 due to higher prices.