The US hog market enters 2024 amidst bearish conditions, with pork production surpassing demand and causing a downward price trend. This situation may persist unless there are significant changes, particularly in pork exports.
The industry has not aggressively reduced breeding stock despite low prices, leading to continued high pork production. Recent reports show only a marginal decrease in breeding, and enhanced breeding efficiencies are contributing to large pig crops. This has forced adjustments in production projections for 2024.
State-wise, there is a varied picture. While states like Illinois and North Carolina reported lower sow numbers, Pennsylvania and South Dakota saw substantial increases. Major producers like Smithfield Foods have closed some farms, but overall industry response to the downturn has been limited.
On the export front, US pork has seen a rise in demand from Western Hemisphere countries, but exports to Asia, including China, have declined. The US is gaining global market share from the EU, but Asian demand remains a challenge.
Domestic demand for pork is influenced by factors like California's Proposition 12, impacting prices and consumption patterns. Retail margins, taste preferences, and competition from other meats like beef also play a role in domestic demand dynamics.
The potential for growth in US pork exports, especially to China, is a significant factor for 2024. Economic challenges and issues like African swine fever have impacted China's pork production, leading to a possible increase in imports. The timing and scale of China's entry into the US pork market remain uncertain but could be a game-changer for the industry.
Source : wisconsinagconnection