By Bruce Cochrane
The Director of Risk Management with h@ms Marketing Services says an anticipated lag in exports of beef, pork and chicken combined with increased slaughter hog numbers will put pressure on live hog markets.
The U.S. Department of Agriculture is forecasting lower beef, pork and chicken exports.
Tyler Fulton, the Director of Risk Management with h@ms Marketing Services, says the high U.S. dollar has been a key factor.
Tyler Fulton-h@ms Marketing Services:
Exports make up a big function of prices and not just exports of pork but exports of chicken and beef as well.
Chicken has struggled, largely because there are still countries that have applied a ban on U.S. product by virtue of the disease outbreak that the U.S. incurred really about 8 months ago.
The other consideration is the impact of the U.S. dollar.
When you have constraints to the export sector, quite simply it relies on the domestic market to clear more of that product and when that's the case price concessions are the key.
That's really the only way that you can really clear the market of all the product that's being produced.
I think, in the current environment, with relatively constrained export opportunities, it's generally a bearish factor to contend with as far as the impact on hog markets from slower exports of beef, pork and chicken.
Fulton says right now there's a belief that the supply will be relatively heavy for all 3 of those proteins for all of 2016.
He says pork in particular is likely to run into a problem due to the volume of product being produced and number of hogs that will come to market at the tail end of 2016.
Source: Farmscape