Content Spotlight
2024 Feedstuffs Feed Ingredient Analysis Table
It's back! Feedstuffs has updated its feed ingredient analysis values table of more than 100 commonly used feed ingredients.
Uncertainties surrounding the trade environment, disease pressure and consumer sentiment.
Pork producers across the globe are taking a cautious approach to herd expansion, despite improved profitability in some regions. Disease pressure, slaughter constraints and regulatory headwinds, as well as uncertainty surrounding trade and consumer demand, are top of mind, according to the latest RaboResearch report.
“Heightened tensions in the Middle East, the ongoing conflict in Ukraine and Russia, hurricane-related disruptions, and temporary worker issues that closed ports in the U.S. and Canada are pressuring global trade in 2H 2024, adding cost, and in some cases, stranding product out of position,” notes Christine McCracken, senior analyst – animal protein at Rabobank and author of the report. “While most of the these are temporary challenges, even short-term interruptions can have a long tail and are expected to be a headwind throughout Q4 and possibly longer.”
McCracken points out in the Global Pork Quarterly Q4 2024, that despite global feed inventories reaching their best level in years and hog production costs lower in most regions, the feed cost benefit does not necessarily apply to all regions equally.
“In 2024, lower corn and soybean meal costs have provided margin relief and incentivized heavier weights in some regions, while tighter wheat supplies have kept costs high in other regions,” McCracken states. “La Nina often creates regional disparities.”
The main concerns for grain and oilseed production shortfalls are in South and Central Asia, southern South America, northern Mexico and East Asia. Dry conditions in Brazil have already postponed soybean planting and could potentially shrink second crop corn acreage in 2025.
While pork consumption continues to improve as inflationary pressures have started to subside, higher costs of services and food continues to plague consumers. McCracken expects stronger seasonal demand and the high cost of competing proteins to support consumption in the fourth quarter.
As for U.S. pork production, McCracken anticipates a return to heavier-weight hogs this fall, with a full-year production increase of 2.3% year-over-year. Pork values are also holding steady, and in-line with year-ago levels.
“While belly prices remain volatile, ham, rib and loin values are relatively stable,” McCracken notes. “Packers remain profitable at current levels and are expected to keep supply and demand in balance to ensure steady profitability this fall.”
RaboResearch is forecasting a 5% uptick in U.S. pork exports in 2024, with sales returning to Asia in the second half of the year.
Canada: Pork production is down marginally year-to-date as production adjusted to diminished slaughter capacity. Decreased packer capacity has also impacted higher market hog exports to the U.S., with year-to-date shipments up 18% YOY. Rabobank expects feeder pig exports to return to more normalized levels the rest of the year, given more availability and a more favorable U.S. market.
Mexico: Productivity has stabilized, pushing hog prices lower. Pork imports were up 5.6% YOY through July, with U.S. and Canada both posting double-digit gains. McMcracken notes second half imports could be affected by the U.S. pork strike, which sent more product through land-based routes in the weeks prior to the Oct. 1 action.
South Korea: African swine fever outbreaks are expected to reduce Q4 production and limit growth in the sow herd. Korea’s pork imports were up 7.4% YOY in August, driven by Canada and Brazil.
China: Pork prices softened slightly in Q3 but are expected to stay strong for the rest of the year. Herd expansion has been slow despite high profit margins. Pork imports picked up in July and August due to rising local prices, however, there is an increasing chance that China may impose provisional tariffs in the fourth quarter, as EU policymakers intend to impose more tariffs on Chinese electrical vehicles.
Japan: Consumer confidence is rebounding with the rise in real wages. Imports of frozen pork was up 43% YOY in August. Rabobank expects demand for imported chilled pork to increase in Q4, due to the rise in domestic pork prices.
Southeast Asia: Vietnamese hog prices have stayed strong, indicating tight supplies and producer confidence. RaboResearch expects imports to increase through the end of the year due to tight domestic supply and demand growth. Filipino pork production has been challenged by persistent disease breaks. Brazilian imports soared 109% YOY, marking the country the largest supplier to the region.
Europe: EU-27+UK pig production volume growth is projected to be slightly positive for 2024. Environmental regulations will most likely impact 2025 production, with a 10% to 15% drop YOY in the Netherlands. Exports to China were down 7% YTD, but picked up in the Philippines, South Korea, Vietnam and Australia.
Brazil: Pork exports in September were up 9%. China remains Brazil’s largest export market with 19% of total sales, despite a 42% reduction in exports YTD. RaboResearch is anticipating a 2% YOY increase in pork production in 2024.
You May Also Like