US pessimistic about pig price in 2021

Last summer, the Iowa/Minnesota quotation dangled for a few weeks around a meager price level of $0,61 per kilo. In the past 20 years, the quotation has only been lower once, that was in 1. In the fourth quarter the quotation rose again, but it was not a big deal. The growing pig herd is putting pressure on the price, while domestic sales are being hit by the corona crisis.

The expectations for this year are not much better. The USDA provides a year-round price range between $0,90 and $1,20 per kilo. The peak will take place in the summer months and the pig price will reach its lowest point in the third quarter, according to the analysts in Washington DC. For what it's worth, of course, because predicting the pig price often turns out to be not an easy matter.

Growing pork production 
The pessimistic forecast is motivated by the ever-growing pork production in the US. Production for this year is estimated at 12,9 million tons, which amounts to plus 1,25%. At the same time, this is the lowest growth since 2014 when production was hit by the PED virus. The USDA also predicts declining pork export figures, mainly due to the fact that production in China is on the rise again.

For the whole of 2021, the estimated export volume is 3,2 million tons, more than 2% less than last year. From a historical perspective, these are still excellent export figures. The major bottleneck is domestic meat consumption, which is being slowed down by the coronavirus.