Competing Meat Prices and Supply Matter

Most ranchers pay attention to the price of corn, but do not necessarily track hog or pork prices. In today’s environment of lackluster exports and the strong dollar, ranchers need to be paying attention to the price of competing meats. Colorado State University and Extension Economist Dr. Stephan Koontz says
Koontz: “We producers watch corn — corn drives a lot of other things. I don’t think pork will drive beef — but it will have a bigger impact over the next few years. It already has. If you go back to the really part of or the middle of 2014 and look at hog prices — not pork not wholesale pork prices — but hog prices on the farm. Right now prices are between a third and half to what they were a year ago. That is a lot more pork. Those guys are good at that — they can grow a hog. What happens with competing meats matters a lot.”
Dr. Koontz adds that it is important to remember that usually one in four pigs is exported and in this current strong dollar market — there is more domestic pork supply available.
Koontz: “That is the market that grows is the overseas market. What beef producers need to keep their eye on is the pork production - those producers can really grow hogs. We have to export that meat or it stays here and we have lots and lots of pork on the menu of places.”