In the face of a possible softening pork demand pork producers are being advised to seize any opportunity to protect themselves during price rallies by forward contracting their production.
A larger than usual supply of slaughter hogs for this time of year, along with uncertainty on the pork demand side has delayed the typical spring rally in live hog prices but producers have started to see signs of improvement.
Tyler Fulton, the Director of Risk Management with h@ms Marketing Services, says we are seeing some of the highest production ever for this time of year and, while demand for pork has been very solid for the past two years, there is some question that it might be softening a little bit.
Tyler Fulton-h@ms Marketing Services:
There's a lot more competition from chicken and beef right now.
Large supplies there have brought prices down on that front.
From a domestic demand standpoint there is some pressure there.
It's probably unlikely that we will see the same kind of robust price response that we saw really in the past two years when we hit the tightest supply of the year, because of that extra competition from chicken and beef.
On the export front, that's probably where most of the uncertainty on the demand side comes from.
Source : Farmscape