Economist analyzes pork supplies, price outlook
By Benjamin Herrold, Iowa Farmer Today
Feb 16, 2017
COLUMBIA, Mo. — Missouri pork producers gathered Feb. 7-8 in Columbia for the annual Missouri Pork Expo to talk about the issues facing the industry.
Much of the conversation covered what lies ahead, from new technology to the price outlook. Scott Brown, ag economist with the University of Missouri, spoke to those in attendance about the market outlook for pork producers.
Producers do have some tough times to navigate, Brown said, adding they shouldn’t expect the markets of 2014 to return, although the news isn’t all bad.
“2017 has been better than expected so far,” he said.
Brown says from 2010 through 2014, meat production remained pretty flat. The 2012 drought hurt cattle numbers, and swine diseases affected hog numbers. The flat production led to higher prices. But since then, meat supplies have been growing quickly.
“We’re getting a lot of growth in domestic meat supplies, growth we haven’t seen in some time,” he said. “…We’ve been growing our pig crop a lot.”
Brown expects this growth to continue this year and next.
“Another over-a-billion-pound increase in pork production in 2017, and another billion-pound increase in 2018, no matter which projection you look at,” he said.
Producers are expected to add 10 billion pounds of pork to the market from 2014 through 2018 — a five-year increase not seen since the early 1990s.
Brown said increasing hog slaughter capacity should boost prices and diminish fears of a significant fall or winter price crash.
“More hog slaughter capacity is certainly going to help,” he said. “As new plants compete for hogs, producers will benefit.”
Of course, demand strength remains critical, both domestically and through exports. Late 2016 saw good export growth, Brown said.
“We’re up about 65 million pounds in December relative to a year ago,” he said. “That’s phenomenal growth. Half of the growth went south to Mexico.”
Brown said he’ll be keeping watch on President Donald Trump’s efforts to renegotiate trade deals, such as NAFTA.
“I can’t predict that very well, but I worry,” Brown said...