The Director of Risk Management with HAMS Marketing Services is blaming a record availability of U.S. slaughter hogs combined with a reduced holiday slaughter schedules for a dramatic reduction in North American live hog prices.
Western Canadian live hog prices have fallen dramatically.
Tyler Fulton, the Director of Risk Management with HAMS Marketing Services, says we are seeing a huge amount of pressure from the U.S. and pretty much exclusively the record setting supplies we’ve seen come to market.
This time frame is typically seasonally the highest production time frame of any part of the year. When you combine that with the stoppages that relate to the U.S. Thanksgiving it really shifts the balance of supply and demand on a live hog basis in favor of packing plants where we’ve just got so many hogs and not enough hours given the holidays to process them. That’s pretty much what’s driven us to these low price levels and there’s no immediate end in sight. We can expect low prices likely to continue through the Christmas holiday period where, again, we see reductions in production capacity at a time when we’ve got weekly U.S. hog slaughters larger than 2.75 million hogs which easily surpasses any previous record.
~ Tyler Fulton, HAMS Marketing Services
Fulton says we know there’s a massive hole in meat protein in Asia right now but the issue is really accessing that market from a North American standpoint. He acknowledges Canada is in a better position with the restoration of clearance to ship pork to China but he says that’s not enough to make a difference and we’ll need significantly increased volumes to offset the effects of the huge supply we’re dealing with.
