Price Outlook for Hogs

It is quite likely lower feed prices will be around for a series of years – not just one. It will make it easier for the pork industry to expand – in what Purdue Ag Economist Chris Hurt calls a mini boomlet over time driven by higher U.S. per capita consumption of pork, continued modest growth of domestic population and a bigger export market…

“For hog production in the coming year, this means a 1-3% expansion of the breeding herd. Increased pork production from this expansion is going to begin by late next summer and prices will start to move back below year previous levels of that time.”

As an example – Hurt says hog prices in the last quarter of 2014 are expected to be 58-dollars per live hundredweight compared with 65-dollars per live hundredweight during the last quarter of 2013…

“The big profits will come during the 2013-14 corn market year, reaching about $37 per head of profits on average during the second and third quarters of 2014. The hog prices are expected to average around $65 late this year and into the winter of 2014. We should see record high hog prices in the second quarter, averaging near $72 on a live weight basis, followed by $67 for the third quarter. As Pork supplies will begin rise in the late summer of 2014, hog prices are expected to drop to about $58 for the final quarter of 2014.”

These profits are driven some by higher prices for pork, but mostly says Hurt by the lower price of corn.