What is in this article?:
- Retail pork prices still rising due to PED virus
- Industry returned profitability in 2013
- Retail pork prices will keep rising to record highs this summer as the number of hogs going to market over the next several months will be lower than expected because of the PED virus.
Retail pork prices will keep rising to record highs this summer as the number of hogs going to market over the next several months will be lower than expected because of the PED virus, smaller spring farrowings and growing foreign purchases of U.S. pork.
But he also expects the price increases to level off in the fall and move somewhat lower into the winter as producers benefiting from higher profits increase production. Although producer profits were at a record high near $70 per head in the second quarter this year, Purdue University agricultural economist Chris Hurt says the record will be surpassed this summer, with third-quarter profits expected to exceed $90 per head.
"These extremely high profits are clear signals for producers to increase pork production," said Hurt, who analyzed the U.S. Department of Agriculture's Hogs and Pigs report, released June 27. "The report did reveal that producers have received this signal, and they intend to increase farrows by 4 percent this fall."
If producers start the expansion and the porcine epidemic virus that has been killing piglets is better controlled, pork supplies can begin to grow by next spring to 4-6 percent in the last three quarters of 2015, Hurt said.
"More relief from record-high retail pork prices can be expected in the second half of 2015 as pork supplies build," he said.
While he believes that pig losses from PEDv will likely trend lower this summer, he says the USDA report suggests that the disease is far from controlled, with the virus apparently continuing to inflict greater numbers of deaths in the spring than had been expected.
"The general opinion had been that the PEDv death losses would be reduced as the weather warmed this spring, because PEDv does not spread as readily in warm weather," Hurt said. Death losses of about 8 percent in the winter were still about 5 percent in May.