A “Breath of Fresh Air” Coming for Pork Industry

The pork industry has experienced some turbulence lately, as changing legislation paired with supply and demand raises questions about hog profitability. However, Steve Meyer with Ever.ag forecasts break-even market prices despite higher input costs.

"Things have gotten much better, back in December when I estimated profits and losses, I had a 12 dollar loss, that number as of Friday is a plus dollar 66 cents, so that's nothing to write home about but it beats minus 12."

Meyer estimates six months of profits; but, the average producer may be five to six dollars higher on cost.

"Still the direction is right. It's coming off a terrible year last year and by the model even worse than 1998 was and yet we're kind of headed in the right direction so it's kind of a breath of fresh air as we go into the winter here."

Meyer says there are only three things that could bring back profitability, either costs have to go down, demand improve, or supplies cut.

"Well we're getting two of them for sure, we're certainly getting lower costs, and if you look at the ag outlook forum, last week, with the acreage they've got in and yields they've got in and the carryout. I mean, 350 million bushels and 2.5 bushels of corn, we're going to get a break on costs here, probably more than we've seen."

On the bright side, Meyer says demand may get better and exports have been great.