Pork prices may drop as farms rebound from virus and stocks surge
Last year millions of baby pigs died due to a virus which increased the price of pork. However, high temperatures over the recent summer and the improvement of biosecurity management has reduced the number of piglet virus incidents.
With farmers establishing new health protocol, along with warmer weather and sunshine, the number of incidents of the virus has dramatically fallen – the virus does not spread as much in warmer temperatures.
Entire litters of baby pigs were dying because of the porcine epidemic diarrhea virus, subsequently decreasing pork supplied and increasing the price of pork. According to the USDA, the price of pork was $4.20 per pound in the week of Aug. 14 – 11 percent higher than the year before, at $3.76 per pound.
According to a U.S. Department of Agriculture report, supplies are now up significantly, with a total of 5.46 million new baby pigs born between June and August in Iowa, America’s number one producer. This represents the highest quarterly total in more than 20 years – with a record 10.7 pigs surviving per litter.
With the cost of feed decreasing along with the virus being maintained, pork producers in the US can expect to profit around $60 per animal – an all time high. The average profit per animal over the past two decades has only been $10.50.
The U.S. Department of Agriculture has said that producers are increasing their stock by thousands, in what appears to be an attempt to take advantage of the rise.
A surge of stock increases should push down the profit per animal down to around $30 in 2015.
Purdue University economic professor, Chris Hurt, said it takes almost half a year for a pig to reach market weight. Therefore, the increased supply could mean a slight drop in consumer prices this winter and a more noticeable drop in spring.