Hog Markets Continue To Struggle

 

The hog markets continue to be impacted by huge uncertainty.

 

Tyler Fulton with Hams Marketing Services says cash prices have completely fallen apart, adding carcus values are coming down from their record high levels due to a resurgence of production.

 

"We're seeing a recovery in U.S. slaughter levels after seeing roughly a third of a cut in production levels about a month ago. Last week we pretty much think that the slaughter levels have recovered to something close to maybe something within five per cent of normal slaughter levels, which is absolutely key to the direction of where the markets going to go."

 

Fulton notes prices remain extremely unprofitable for hog producers in western Canada.

 

"As we sit today, values have come down very sharply and so really we're looking at some of the worst cash values for this time of year that we've seen for more than 10 years. It's really not a good scenario for producers."

 

He also commented on forward prices.

 

"Our forward prices are reflecting that huge uncertainty in the market. The forward prices are kind of in a weird spot because to try to predict whether or not for example restaurants in the United States are going to be open two months from now, or six months from now and whether or not the packing plants are going to be operating at full capacity in that same time frame. It's almost a fool's game."