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Hog price recovery near: Rabobank
Story Date: 10/15/2012
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Source: Lisa M. Keefe, MEATINGPLACE, 10/12/12
Global hog prices are expected to remain under pressure for the next several weeks, but prices will recovery toward the end of 2012 and into 2013 when the current supply boost from feed price-induced herd liquidation fades, according to a new report by Rabobank.
Although the company did not project prices for the fourth quarter, is noted that, historically, average hog prices dropped 9 percent in the third quarter of 2012, compared with the second quarter. Year-over-year hog prices have dropped 16.2 percent in the U.S. Prices have dropped more precipitously in Brazil and China over the past year, but considerably less in Canada and the EU, Rabobank reports.
For the report, the company’s Food & Agribusiness Research and Advisory group looked at the issues of pork supply, demand and pricing in China, the U.S., the EU, Canada, Brazil, Japan, South Korea, Mexico and Russia, as well as industry-wide. In particular, the report looks at the impact of drought in various markets.
David C. Nelson, global Animal Protein strategist at Rabobank and an author of the report, said, “Diverging price trends in key markets were the distinguishing feature of the global pork trade in [the third quarter of 2012]. Clearly, production cycles are not synchronized globally — and this creates opportunities for those with flexible procurement and sales operations.”
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