Fears Over PED Continue to Drive Live Hog Markets

By Bruce Cochrane

The director of risk management with h@ms Marketing Services reports, despite higher available supplies of pork than one year ago, fears over PED continue to drive the markets for live hogs.

North American pork producers have enjoyed strong live hog prices this spring fuelled by fears over losses due to disease.
Tyler Fulton, the director of risk management with h@ms Marketing Services says the major focus of the market has been on the impact of PED and the speculation associated with that.

Tyler Fulton-h@ms Marketing Services:
Generally speaking the market has been trading at a pretty strong level and significant gains over last years prices at this time, that we saw at this time and it's predominantly related to the fact that the pork demand is generally pretty strong and there's ideas that supply is tight.

I stress the word ideas because the reality is that carcass weights have more than offset the decline in hog numbers due to the losses from PED.

The reality is that we're actually dealing with more pork compared to what we saw this time last year and compared to the start of the year.

The market has factored in a short supply but the reality is that it's not come to fruition yet.

Fulton notes we typically see a five to six percent decline in hog weights from late April until late June but, what's remarkable over the past month or so, is we have not seen any seasonal decline in hog weights.

He says some of the space that's been freed up in feeder barns as a result of fewer hogs being fed is being used to take animals to a heavier weight.

He says the packers are more than happy to deal with the heavier hogs because their numbers are tighter and they need the heavier weights to meet their own orders and requirements.

Source: Farmscape