Despite the fact that pig slaughterhouses in the United States have increased production capacity again, meat stocks remain at a low level. In July, the volume in cold stores was at its lowest level in 9 years. How does the pig price react to this?
At the end of last month, the US stockpile stood at 208.000 tons, according to figures from the Department of Agriculture (USDA). A decrease of 25% compared to the same month last year and also the lowest level in 9 years. Meat stocks also failed to recover compared to June, despite the fact that pig slaughterhouses have taken up the challenge again after mandatory closures due to the corona virus.
Grill season and high export figures
During the summer months it is grilling season in the US, which means that domestic demand for pork is at a high level. This year even more than usual, because Americans eat less outside the home due to the corona measures. In addition, the export of American pork continues to be at a high level. In the first half of this year, 1,5 million tons of pork were exported, a quarter more than in 2019. China in particular is on the market, as is Hong Kong. Although the figures for July are not yet known, it is obvious that the good trend will continue. After all, China reported about July an import record.
Meat supplies are expected to increase this fall, as is seasonal practice. Then there is less grilling and the US also has a lot of pigs. During the last breeding in June it turned out that the pig herd had increased by 5% compared to last year. This indicates that slaughter numbers remain high. Because meat supplies have to come from far away, the gap with other years will probably continue for a while.
Pig price at low level
American pig farmers hardly benefit from the tight meat supplies and the high export figures. The Iowa/Minnesota quotation has been moving below the $1 per kilo limit since April. In July, the price had even fallen to $0,61, the lowest level since 2002. In the meantime, the price has recovered somewhat.