By Joanna Newman
THE pig disaster is worse than the 1930s depression, with small operators across the United States losing hundreds of thousands of dollars this year.
A few weeks ago, the National Pork Producers Council advised pig farmers to give away animals to charity. Now industry players are suggesting carrying out a wholesale pig shoot and burying them.
The cash price has dropped to single digits: 9-11¢/lb (11.8-14.4p/kg) at the last count, compared with 14.5-16.0 a week ago. The Chicago February live pigs futures contract settled on Thursday, 17 December at 28.15¢/lb, a 25% drop since the start of the month.
The market has halved since mid-June.
US packers are unable to keep up with supply, even if they run flat out seven days a week. The nation has lost too much slaughter capacity over the past year and packers are able to bid down for market-ready animals.
Until producers can increase their sow slaughter to reduce future supply, the market cannot enter a cyclical upturn, analysts warn.
Some commentators are blaming imports of live pigs from Canada, which are taking up valuable space in US slaughterhouses. It seems extraordinary that the Canadian market could be even worse than the that of the USA, and that Canadian producers would be induced to ship their hogs across the border.
Meanwhile, historically wide margins for retailers ensures that none of the gains are reaching the supermarket shelves for Christmas shoppers.