 |
| CLICK HERE TO VIEW CURRENT ISSUE |
 |
| Best of NAMA 2025 |
|
 |
|
RABOBANK: GLOBAL PORK PRODUCTION RETURNS TO PROFITABILITY
May 8, 2024
Source: Rabobank
According to a recent Rabobank report, the global pork industry is witnessing a pivotal shift as sow herd numbers begin to plateau after a period of decline. This stabilization is a result of better-than-expected consumption trends coupled with reduced production costs across most regions.
These factors are contributing to a more optimistic outlook for hog prices and are encouraging producers to consider rebuilding their herds. However, producers in regions with ongoing health challenges or higher regulatory costs may experience a slower recovery pace.
Supply-demand equilibrium slows herd contraction
"The industry's improved supply-demand balance has led to a slowdown in herd contraction," says Christine McCracken, Senior Analyst - Animal Protein at Rabobank. "Although meaningful growth in the breeding herd is not anticipated until late 2024 or early 2025, productivity enhancements are contributing to increased production." Notably, the US, Canada, and China are seeing healthier herds, which is translating into greater hog availability.
Cost reductions fuel industry's return to profitability
Higher global stocks of grains and oilseeds have resulted in lower feed costs for producers, which is a beneficial boost for the industry. A robust South American crop has further pressured prices, providing some relief from other inflationary costs. As the Northern Hemisphere approaches the spring planting season of 2024, all eyes are on the growing conditions that will influence future feed costs.
Pork's competitive edge in a cost-conscious market
Despite a dip in consumption in key Asian markets during the first quarter of the year, pork is maintaining its position as a cost-effective protein choice for consumers worldwide. "This is particularly significant in light of rising beef prices. The trend toward frozen products and home cooking is expected to continue bolstering retail pork sales, with a projected uptick in value-added and processed meat sales as inflation rates peak," according to McCracken.
|
|
|
|
|
