28 November 2023

3 minute read

By: Jim Long

North America

The Thanksgiving holiday is over and its indeed a special holiday that leads to reflection on what we should be thankful for. Faith – Family – a society that has relative prosperity and hope. Most of us if not all of us are descendants of immigrants that came for a better life and opportunity. Few if any immigrated because of too much wealth. We are descendants of people who had the courage to leave their homes and travel to a new land. It was and still is a life altering decision to leave your country and to forge a new life. This act in itself leads to a nation of doer personalities. Leading innovation and entrepreneurship as a cornerstone of our society.

As pork producers in today’s economic climate, it takes all the spirit of our immigrant forefathers to keep positive in the face of the financial challenges that have been relentless for over a year and still continues. The resilience of pork producers is an admirable trait. If we were in a war, we would want to be in a platoon of hog farmers, “They keep fighting and are hard to kill.”

Markets

Thanksgiving is a special holiday but every year it seems to pay havoc on the hog market with the holiday closure of slaughter plants in the midst of the highest hog slaughter availability each and every year. Probably on an annual basis it costs the industry $250 million in lost revenue between hog prices and what happens to lean hog futures.

• US weekly red meat production continues to run lower than a year ago. This past week down 5.1%, year to date down 2.6%. 1.3 billion lbs. lower year over year. Beef year to date down 5.4%. Pork up 0.4%. As we move in 2024, we expect beef volume to stay low and year over year pork supply to decline. Less red meat production should be supportive to stronger prices. We believe current 2024 lean hog futures are much lower than we expect hog prices to be.

• We do business in Mexico. We are getting reports of about 100,000 sows have been liquidated (10%) due to financial losses. This would lead to prices being supported for Mexican producers and opportunity for more US pork imports to fill the void domestically.

• The US herd in our opinion continues to shrink. We believe this due to higher sow slaughter, less gilt retention, continued high sow mortality and conversion to Prop 12 rules that cuts the sow herd number in the same barns.

• How many sow units are running full? To maintain a sow herd, you need to work at gilt replacements. Financial issues are not conducive to aggressive gilt retention. Breeding herd is not just producers going out of business. Every 1% drop in the industry due to lack of gilt replacements is 60,000 sows in the US inventory. PigCHAMP average sow mortality data indicates industry mean is 14.59%. Over 1% a month. Need to be putting gilts to fill the attrition hole or herd just keeps getting smaller leading to fewer pigs.

This past week was the anniversary of the John F. Kennedy assassination. If you were alive, it's a good chance, we all remember where we were when we found out. I was told coming in from afternoon school recess. It was speech day, and I was next. After school I remember going back to our farm home and my parents talking in hush tones and shock of it all. That day is the first memory I have truly etched in my mind.

In honor of President Kennedy a few of his quotes:

“Every accomplishment starts with the decision to try.”

“Those who dare to fail miserably can achieve greatly.”

“Do not pray for easy lives, pray to be stronger men.”

“If not us, who? If not now, when