LUBBOCK, TX – Strong pork production is running into weak domestic and international demand, creating continued pressure on hog prices and processor margins.
CoBank livestock economist Abby Groves says pork supply remains strong while demand has been relatively flat. That imbalance has left the industry searching for additional outlets for growing production.
Domestic demand softened during the summer grilling season, while export demand has also struggled. More than one-quarter of U.S. pork production moves into international markets, making weaker overseas purchases especially important to the price outlook.
Groves says pork cutout values had recently posted roughly 24 to 25 consecutive weeks below year-earlier levels. Retail pork sales have continued growing in both dollars and volume, but not enough to absorb available supplies.
The result has been weaker profitability across the hog sector as producers and processors wait for demand to catch up with production.
Farm-Level Takeaway: Strong pork supplies need stronger domestic and export demand before hog-market pressure can ease materially.