More US pigs going to market as beef takes a back seat

Updated: 2015-02-04 07:52

By Bloomberg(China Daily USA)

  Print Mail Large Medium  Small 0

In the United States, the country that made the hamburger a global icon of American fast-food cuisine, beef is about to fall another spot on the meat scale.

For the past two decades, chicken has outranked beef as the most produced meat, and now pork is about to surpass it as well. Hog herds have rebounded from a deadly virus last year, while record-high meat prices and cheaper feed led to breeding of more sows and bigger pigs. As pork output in 2015 jumps 4.6 percent to a record, cattle ranchers have yet to recover from a 2012 drought, and beef production is headed for a 22-year low, the US Department of Agriculture estimates.

When porcine epidemic diarrhea virus killed millions of piglets across the country in 2014, prices for bacon and pork chops surged to all-time highs as supplies tightened. With more hogs arriving in recent months and demand increasing, costs are dropping for buyers including Domino's Pizza Inc.

"A year ago, it looked like the sky was going to fall," said Ed Juhl, a farmer in Hudson, Iowa, who lost about 2,400 pigs to the virus in June.

His herd is now healthy, he expects output by June will be back to its annual sales pace of 36,000 animals. With each passing week, the industry's "confidence that we're going to increase pork supply is rapidly going up".

That's because the breeding-sow herd, during the three months ended on Dec 1, posted the biggest increase since 1998 and reached the largest in five years, the government reported on Dec 23. The total hog population jumped 2 percent from a year earlier to 66.05 million, the most in five quarters.

After two years of bumper corn and soybean crops, feed is cheap and that means hogs are getting bigger. On average, pigs for slaughter weighed 98 kg last year, touching a record 101 kg in May, compared with 94 kg in 2013.

Pork production will climb this year to a record 10.84 billion kg, as per-capita consumption reaches the highest in five years, the USDA said on Jan 12. Beef output will drop 1.7 percent to 10.84 billion kg while chicken jumps to an all-time high of 17.78 billion kg, government data show.

The pickup in supply sent hog prices on the Chicago Mercantile Exchange tumbling 11 percent in January, the biggest drop for the month since at least 1986, data compiled by Bloomberg show. The Bloomberg Commodity Index lost 3.3 percent, and the MSCI All-Country World Index of equities slid 1.6 percent.

CME futures that touched a record $1.33425 a pound (0.45 kg) in March fell to 70 cents on Jan 23, a four-year low. The price, which closed at 70.925 cents on Feb 2, may drop to 65 cents this year, said Don Roose, president of US Commodities Inc in West Des Moines, Iowa.

With wholesale pork already down more than 40 percent from a record in July, prices for the meat on average will be down "significantly" this year, said Jim Robb, director of the Livestock Marketing Information Center in Denver.

The slump may not last if hog production slows or demand accelerates further. Disease still poses a risk to hog supply because PEDv thrives during cold winter months, said Paul Sundberg, vice-president of science and technology for the National Pork Board in Des Moines. While immunity and prevention have improved, "I don't think anybody wants to say, 'Boy, we dodged a bullet'", just yet, he said.

 More US pigs going to market as beef takes a back seat

Although the hamburger is a staple of the American diet and an icon of US fast-food cuisine, pork output in the nation is likely to overtake that of beef this year, government figures indicate. AFP

(China Daily USA 02/04/2015 page16)

More US pigs going to market as beef takes a back seat

8.03K