Pork exports will need to increase by 400,000 tons
By Kate Ayers
Staff Reporter
The U.S. pork industry will continue to expand through 2025 but will be dependent upon export capacity.
The hog market has transitioned from lagging production to a recovery phase over the last 10 years. However, industry expansion, along with increased production efficiency and processing capacity, could improve margins along pork supply chains, according to an Oct. 11 release from Rabobank.
Accompanying this industry expansion is an expected slight growth in domestic consumption per capita, but only within a historical range. U.S. consumer demand for specific pork cuts may lead to periods of high market volatility, according to the release.
Exports are becoming the most critical element of demand for U.S. pork. To promote expansion of the industry through 2025, U.S. pork exports must increase by 400,000 tonnes.
“Exports are necessary for future expansion but are not guaranteed,” Sterling Liddell, global data analyst at RaboResearch Food & Agribusiness, said in the release.
Global pork trade is evolving due to increased international competition and geopolitical issues. For instance, U.S. pork exports to Mexico and China may encounter domestic competition as those countries are expected to ramp up production as well.
“Mexico continues to grow its sow inventories and slaughter plants, making it only a matter of time before Mexico boosts domestic production,” Liddell said.
Indeed, slaughter capacity and efficiency are pivotal deciding elements between sector stagnancy and expansion, the study found.
In the report, Sterling outlined three key aspects of the pork industry that need to be considered in planning over the next decade.