H@ms Marketing Services reports the normal seasonal spring rally in live hog prices is getting off to a disappointingly slow start this year.
Live hog prices have been trending only slightly higher as we've started to see a bit of the typical seasonal rally.
Tyler Fulton, the director of risk management with h@ms Marketing Services, observes the U.S. hog slaughter has been remarkably steady as we're seeing slaughter animals from the sows added to the U.S. breeding herd a year ago hitting the market now and it's evident the vaccines used to manage PED have been fairly successful resulting in fewer losses.
"We've started to see a bit of the typical seasonal rally that we would expect to see at this time of year. But I would say that the U.S. hog slaughter has been stubbornly steady.
Normally what triggers the rally in hog prices in the spring time is a combination of tighter hog supplies and better demand. When people starting kicking off the grilling season, typically in early to mid-May, we usually start to see a pop in prices.
Things are really quite slow to come this year. We've seen slight improvement in recent weeks but typically, we would have already seen some bigger moves."
Fulton notes, on the demand side, we're dealing with a high U.S. dollar making the Americans less competitive on the world market and there's more pork backing up in the U.S. domestic market so we're calling on U.S. consumers to purchase more but, because of last year's high prices, they're not being provided price incentives by the grocers.
He says things aren't optimistic so something needs to snap the cycle.
Source: Alberta Pork