The US pork market looked good at the start of 2025. Sales were smooth on both the domestic and export markets. This led to relatively high pork prices in January. Europe's major competitor on the world market is now facing more uncertain prospects due to the consequences of a possible trade war with neighbouring countries Mexico and Canada.
In January, it became clear that US pork exports in 2024 were 4,3% higher than in 2023. US producers have thus brought pork exports back to about the level of 2020, at the time a record year for the US pork industry. This means that 25% of US pork production is sold abroad. The domestic market was also strong. This ensured that prices for slaughtered pigs were around 19% higher than in the same month a year earlier.
Meat stocks low
The situation is illustrated by the low stocks of pork in storage. According to the monthly report of the United States Department of Agriculture (USDA), there were approximately 31 tons of meat in American freezers on January 2025, 186.000. That was about 11% less than on January 31, 2024, when there were still 210.000 tons of pork in stock. Compared to December, the stock increased slightly, which is not unusual in the first month of the year after the holidays.
At the same time, slaughter numbers are lagging somewhat behind expectations based on USDA animal counts for 2024. In January 2025, nearly 11,5 million hogs were slaughtered, about 1% more than last year, according to the USDA.
Chicago Futures Market
Despite the above factors, prices on the futures market for slaughtered pigs have shown significant corrections in recent weeks. President Trump has threatened import tariffs of 25% on products from Canada and Mexico. These two countries account for almost 50% of American pork exports. There are fears that countermeasures could also affect American pork producers. According to the latest rumors, the import tariffs for Canada and Mexico will go into effect on March 4. In addition, Trump is also threatening additional tariffs for China, another major importer of pork.
Although it is unclear what any countermeasures will look like, the futures market for slaughtered pigs has taken a big hit. It is uncertain whether volumes to Canada and Mexico can be affected and, if so, where they can be exported to. The most obvious expectation is that the amount of pork offered on the American domestic market will increase, resulting in price pressure. It could also lead to a larger supply of export meat to Asia, which could impact the position of European exporters.
On the futures market, prices for meat pigs (contract April 2025) have fallen by around 12% after a peak in early February. Converted to euros per kilogram of slaughtered weight, this means a price of around €1,80 per kilo of slaughtered weight. Much lower than the €2,03 per kilogram of slaughtered weight in early February.
Export development
In addition to these uncertain geopolitical circumstances, the most recent export figures do not yet give hope for a strong year. Compared to a year earlier, the volumes in the period up to and including 6 February have decreased by 14%. The decreased volumes to China and Korea in particular (32% and 22% respectively) have an impact on the total amount of pork exported. Insiders on the American market also do not expect a smooth recovery of demand from China. The country is increasingly able to provide for its own pork needs.
The US pork market is therefore confronted with mixed signals. Strong domestic demand and modest production increases on the one hand, but uncertainty about the export position on the other. The supply of US pork available for the world market this year will most likely be in line with 2024. Geopolitical tensions may cause temporary disruptions in trade flows. For the time being, European exporters have no choice but to wait and see how the market will develop with their major competitor on the world market. In addition, whether trade restrictions will have a positive or negative effect.