We had some positivity last week in the hog market with lean hog futures coming up from contract lows by around $4.00. Of course, December going from 66 to 70 just means you lose less money. Less dismal.
Certainly, less Pork and Beef in Cold storage 181 million lbs. less. Positive for price upside.
- U.S. hog weights continue lower year over year. Last week USDA reports 284 lbs. vs. 289 lbs. last year. The lower year over year hog weights continue to keep weekly Pork Production similar to a year ago despite higher hog slaughter. This past week there was 2% more hogs slaughtered year over year but actually less Pork. 550.1 million lbs. vs. 550.9 a year ago.
- The U.S. Pork industry has been suffering financially. A reflection of that reality is the operating loss of Smithfield Foods in the U.S. and Mexico in the first nine months of 2023. The loss $551 million. Smithfield Foods is the largest producer and packer in the U.S.
“Such loss was primarily attributable to the unfavorable market conditions in the U.S., which included the high costs of hog production and low sales value of pork products,” the company said in a filing.
“We expect such unfavorable operating landscape overhang will continue during the remainder of 2023,” WH Group stated. “As a result, the short-term financial performance of our Group will be under pressure.”
In our opinion Smithfield’s financials are an indication of where most of our industry is. Lots of losses with losses continuing for the next while. Smithfield has been public on the ongoing sow herd decrease. They are not alone. Sow herd decrease is ongoing as the financial losses continue.
- The reported average price for an early wean pig last week in the U.S. was $23, the average price in Europe was 69.5 Euros ($73). A reflection of the difference in profitability between two areas. Europe cut over 1 million sows. Less pigs = Higher prices.
Genesus Customers Dominate Awards
Genesus believes the industry needs to produce Pork that gives consumers the best eating experience. We also believe the pigs that produce the Pork need to have a competitive cost of production.
There is a Packing Plant in Lethbridge, Alberta owned by Maple Leaf Foods. The plant focuses on Pork to Japan and has a brand called Lethbridge Heritage that is sold in grocery stores across Canada. Recently Maple Leaf Lethbridge gave quality awards to producers that are shipping to them. Genesus customers dominated the awards. Full Program Genesus farms took 8 of the top 9 spots when it comes to carcass, meat quality and overall performance. The top 3 farms in the Index category and Meat Quality category were all Full Program Genesus and the Signature Award category Full Program Genesus farms took 1st and 3rd place (Genesus Jersey Red Duroc x Genesus F-1 Female) commercial production farms (no ABF, no Prop 12, not Humanely Raised, etc.). In the Index category which measures loin size and color all 3 farms were Full Program Genesus. The Meat Quality category looked at marbling, color and firmness which Full Program Genesus farms got all 3 top spots. For the Overall Signature Award which looks at overall best score in 5 categories (Meat Quality, Index, In Core, Delivery Time, Signature) Full Program Genesus farms took 1st and 3rd place.
Many people in the industry say that you cannot get good production and better tasting Pork, the reality is however Pigs Mated Sow a Year (PMSY) the Genesus herds that won 8 out of 9 awards were Big Bend 32.89 PMSY, Elm Spring 29.21 PMSY, Starbrite 28.8 PMSY, Kings Land 28.48 PMSY and Neu Meuhl 27.40 PMSY – Full Program Genesus herds getting excellent production on top of being the Ultimate Tasting Pork. If you want to try the Lethbridge Heritage Pork in Canada you can purchase it at Loblaw Companies Limited grocery stores (Real Canadian Superstore, Loblaws, etc.).
Lethbridge Heritage Pork at a Grocery Store in Canada