June 14, 2005

Falling US live hog prices
 

North American hog prices have been dropping 15-20 percent over the past month, according to reports.

Analysts expect that global pork demand and US slaughter numbers would mainly affect North American live hog prices over the rest of Q2 and throughout Q3 this year. The falling live hog prices are observed to be contrary to the normal trend of increasing prices during this time of year.

The main reason for the fall in hog prices is believed to be reduced pork demand, with US slaughter numbers only up about one percent from last year.

One main indicator of decreased demand is US cold storage pork stocks that have increased by almost 26 percent over the past year and are up 13 percent over the last three months.

US pork cutout value has also dropped by 15 percent over the last three weeks with pork bellies dropping almost 30 percent.

Analysts expect hog prices to rebound if pork supply is reduced because of less hogs slaughtered.