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Packer capacity might become an issue before the end of the year

LISTEN: Money Matters 6-15-16

Corn and soybean prices have seen strength in recent months, adding to the cost of pork production.

Steve Myer, who is the vice president of pork analytics for EMI Analytics, says this weather market will influence profitability in the swine business…tape

“On the cost side, hogs we are selling now, the costs aren’t too bad in them. That is a weather scare that would take the cost of production from $62 up to the $70 range.”

Meyer says domestic consumer demand remains relatively strong. Internationally, the focus is on China…tape

“The data that we got showed exports to China in April were 95 percent larger than a year ago. That sounds really great but the year-ago number was really bad. But still that put them back on the long-term trend that they have been. The question now is, have they been active enough to drive us to one of those windfall export episodes that we had back in 2008 and 2011 when the Chinese were in our market big time.”

Packer capacity will likely be an issue before the end of the year.

 

 

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