Best Ever Period of North American Hog Sector Profitability Forecast Dependant on ASF Status

 

An economist with Kerns and Associates says, if the North American hog sector can remain free of African Swine Fever, it can expect the best run of profitability ever. Hog Sector Economics, Key Factors to Consider will be among the topics discussed as part of Saskatchewan Pork Industry Symposium 2019 set for November 12th and 13th in Saskatoon.

 

Joe Kerns, the President of Kerns and Associates, says with hog numbers expanding the real driver of profitability right now is on the revenue side, how much am I being paid?

 

 

We've seen a nice little appreciation in the hog market recently in front of the Chinese talks that has offered very handsome profits for 2020 and we've been here a couple of times before. We had the run up in the spring of this year that was somewhat ill-fated then again in the summer with the July time frame that offered some great profits and here we are again.

 

As we enter the first portion of October with traditionally more animals coming into the market place, we're setting some new contract highs for the 2020 contracts. It makes for a good problem for the pork producer. Do I say yes to some very handsome profits in 2020 or do I hold off under the anticipation that the devastation of ASF, in China specifically, is going to mandate exports from countries that remain clear of ASF and offer even better profits right now? It's a very interesting time for a pork producer.

 

Kerns says, while the sector works to handicap the losses from African Swine Fever, exports from both the United States and Canada have picked up recently and there's a lot of hope for the future. He says, if we remain clear of ASF in North America, we're going to have the best profitability run in the history of the industry but, if we succumb to the disease, it's going to be the exact opposite and we'll be in misery for a longer period of time than most people realize.