May 5, 2004

Strong US Red Meat and Poultry Demand Fuels Higher Hog Prices

The SPI Marketing Group says a stronger US demand for red meat and poultry has helped fuel a sharp increase in the price of live hogs in Western Canada.

Hog prices in Western Canada have increased sharply over the past few weeks, and the figures are 25 to 30 percent higher than the same period one year ago.

SPI Marketing Group Manager Don Hrapchak says prices are currently hovering between 1.75 and 1.85 per hundred kilograms.

"We've had a very good increase in hog prices. That comes even with hog production and hog marketings at slightly higher levels than what we had last year. Hence we are not only producing more animals, we are also getting a much better price."

Most analysts would indicate that the major reason for the increase in prices would be the extremely strong demand for red meat and poultry in North America at this time.

Red meat prices are all stronger. Poultry prices are stronger in the United States and in Canada to a certain extent. That increased demand has pulled hog prices up nicely this year as compared to last year.

Another factor would be the very strong buying activity from the Japanese market in the first quarter of this year.

Hrapchak says overall demand for meat protein in the US is stronger, with beef, pork and poultry all showing gains, and pork showing the most gains.

He says these higher prices are especially encouraging, given the fact that producers have gone through some very difficult periods during the past five years.