Continued pressure on US prices as slaughterings increase
US pig slaughterings in the first nine months of 2015 were running 9% higher compared to the same time period in 2014, at 85 million head.
In 2014, the US pig herd was heavily affected by PEDv, with a decline in both slaughterings and production being recorded. As a result of this, producers experienced a spike in prices, fuelling the higher levels of production which have been apparent this year. The gap between the monthly throughputs for 2014 and 2015 was at its highest point during June, when volumes were ahead by 16%. Average finished pig carcase weights have been running at a lower level year on year, down by 1% for the first nine months of the year, at 96kg. Overall, US production of pork in between January and September in 2015 increased by 8% compared to the same time period in 2014.
The high levels of supply which have been apparent throughout 2015 have had a large impact on prices, leading to a sharp drop in the US barrow and gilts price. The average price for January to September 2015 was about $52 per 100lb liveweight,over $27 down on the previous year’s level. Additional pressure was placed on prices at the beginning of the year, with lows of around $45 per 100lb liveweight being recorded between February and April. Despite the recent uplift, prices are running at a much lower level than in 2013 and 2014, as supply and demand play a pivotal role, especially given limited export growth due to the strong dollar. Looking ahead into the upcoming months, this trend is expected to continue, as USDA forecasts production to increase further, with totals for 2015 as a whole up 8% on 2014. A further small increase in output is expected next year, with prices set to remain low as a result.