Did you have some extra bacon with your eggs or perhaps dine on a heaping helping of ribs or a pork roast this weekend?
Well, if it wasn’t you, it was someone in North America because this month is breaking records for pork production and yet strong demand is maintaining pork and hog prices.
Just a few years ago, analysts warned that whenever weekly hog slaughter in the United States topped two million, nearing capacity estimated at about 2.2 million head, hog prices would be under pressure.
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But Ron Plain of the University of Missouri notes in his weekly report that since Aug. 27, the U.S. has recorded 10 of the 22 largest daily hog kills ever.
Year-to-date supplies have been 3.9 percent higher than a year ago, yet prices early this month were 28 percent higher than in the same week in 2003.
It looks like the end of this quarter will mark four consecutive quarters with increases in supplies and prices.
Even with all the production, pork was being drawn out of storage in August to meet the demand.
The factors behind this are linked to changing consumer taste and the beef industry’s BSE problems.
U.S. domestic demand is supported by the low carb diet craze and by the fact that competing beef cuts are priced high, diverting consumer interest to pork.
Pork exports are also booming. By volume, U.S. pork exports to the end of July were up 26 percent, thanks to big jumps in exports to Mexico, Taiwan and Japan, with the Asian increases related to their ban on beef imports from the U.S. and Canada.
It will be interesting to see how prices hold up as we head into the normal fall marketing increase that usually presses hog prices lower.
There might be weeks when the number heading to slaughter tests the 2.2 million head capacity.
Expect to be asked if you want back bacon added to your burger.
