US pig prices under pressure

By Joanna Newman

MILDER spring weather is making it easier for Americas pig producers to move their pigs to market.

With ample supply on offer to the packers, live pig prices have come under pressure again this week. Cash values at the terminals have slipped by 1.5¢/lb on the week to 24.0-25.0¢/lb (32-34p/kg).

Many packers have withdrawn from the market, having met their short-term needs for live pigs and cash prices could drop further to 20¢/lb (27p/kg), market analysts warn.

High slaughter rates of almost 2 million head a week are contributing to weakness in the wholesale pork market. The worst hit pork cuts are bellies, which have collapsed from 51¢/lb early last week to around 42-43¢/lb currently.

Producers expect further deterioration in pig prices in coming weeks and this is reflected in futures prices which have sold off over the past few days.

The Chicago April lean hog contract settled on Tuesday (16 March) at 40.9¢/lb, down from 43.3¢/lb a week ago.

The monthly supply and demand report due for release at the end of month is expected to confirm a severe structural imbalance in the US pig sector.

Producers large and small are still reeling from unprecedented losses in 1998.

Industry organisations are pushing the government for further federal aid as the debate surrounding livestock assistance programmes heats up.

Across America, independent pig producers are protesting at the emergence of vertically-integrated industry giants and distorted price margins, which they say are threatening their way of life.

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