The pork market recently encountered significant challenges as a result of a seasonal slowdown coupled with harsh winter weather, according to a comprehensive analysis by the Daily Livestock Report (DLR).
Processing plants grappled with closures triggered by transportation difficulties, impacting both workforce and logistics. In the week ending January 13, hog slaughter, as reported by the USDA, plummeted by 19% to 2.174 million head compared to the same week in the previous year. This shortage prompted processing plants to escalate bids for replacement loads.
Throughout the disrupted weeks, hog carcass weights soared to approximately 217 pounds per carcass, nearing the upper limit of the annual range. The combination of high slaughter rates and heavier hogs contributed to an abundance of pork supplies, consequently leading to lower prices in December. In the weeks ending December 23, December 30, and January 6, hog slaughter averaged 2.340 million head per week, marking a decline of 343,000 head per week compared to late November and early December.
The impact on pork prices exhibited variations across categories, with a notable boost observed in the belly market, particularly in pork belly primal, which surged by $40/cwt (41%) since January 3. This surge contributed to a 9% overall increase in the value of the pork cutout during the period. Conversely, the ham primal experienced a decline of about 5%, potentially influenced by transportation issues affecting exports, while the picnic primal saw an 8% decrease. Pork trim recorded a significant 11% increase, underscoring the supply shortfall and the imperative for processors to meet production demands.
The DLR analysis anticipates a gradual recovery in pork supply, emphasizing the need for vigilance among end-users as spring and summer approach. Additionally, the analysis suggests that slaughter rates are unlikely to remain at the recently elevated levels, highlighting the ongoing challenges faced by the pork market.
