Pig prices in US plummet in October

October was not a good month for the pig futures market on the CME in Chicago. Physical pig prices in the United States are also under pressure.

The CME December contract closed Friday, October 31 at $0,76 per pound (=0,45 kilo). At the beginning of the month, the futures market was still worth $0,92. This equates to a decrease of 17%. Physical market prices are also under pressure. For example, the Iowa/Minnesota quote fell by 23 cents to $1,38 per kilo in October.

Price pressure continues 
This means that the price pressure, which has been taking place since mid-June, continues unabated. Prices have since been markedly depreciated. Halfway through 2021, the listing was at a all time high of nearly $3. The decrease that is now visible is in line with the seasonal pattern in the American pig market. Roughly speaking, prices rise in the first two quarters of a year, before falling back in the third and fourth quarters.

Due to the high pig prices last summer, pork prices in the retail sector have risen to record highs. This slows down domestic consumption, causing meat stocks to slowly rise again. In addition, the US, like Europe, is struggling with a sharply reduced demand from China. This also puts pressure on pig prices. Nevertheless, the export figures can hold up reasonably well this year, because neighboring Mexico imports significantly large volumes.

Wouter Job

Wouter Baan is editor-in-chief of Boerenbusiness. He also focuses on dairy, pig and meat markets. He also follows (business) developments within agribusiness and interviews CEOs and policymakers.

w.baan@boerenbusiness. Nl

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