Source: Tom Johnston, MEATINGPLACE, 10/23/13


Demand from China’s festival season will elevate pork prices the remainder of the year, Rabobank says in a new report on the global pork industry.

The expected elevation will follow a third quarter market performance that saw double-digit price increases over the second quarter. Among the main drivers of that trend were tight supplies in the United States due in part to the porcine epidemic diarrhea virus (PEDV).

Rabobank predicts global pork prices will remain elevated for the remainder of the year, explaining that production has been tempered as producers first try to regain part of the lost margins of the last few years before expanding, even with positive prospects in feed prices.

Into 2014, declining feed costs will continue to support slow herd rebuilding, the bank predicts. Along with productivity increases, this will result in higher supply and likely lower prices. The bank cautions that the price slide will be slow due to the limited growth of sow numbers, the continuing demand growth in Asia and still relatively high feed costs, which will curb supply growth at least until mid-2014.

Meanwhile, Shuanghui’s acquisition of the world’s largest pork company, Smithfield Foods, has been another example of China’s growing dominance in the global pork industry. The country’s import demand increasingly has been exerting influence on prices in different regions throughout the world in the last few years.

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