Consumers hold the key to how quickly pork prices rebound from the dip they experienced following the current influenza outbreak, according to a Texas AgriLife Extension Service economist.
Hog prices nationwide had dropped to an average of about $59 per 100 pounds of carcass weight Tuesday morning, down from about $62 last Thursday, according to the U.S. Department of Agriculture. Seasonal prices for this time of year typically climb past $70 in late April and May.
"(A lot of this) depends on how consumers react," Anderson said. "If demand for pork declines, they've got to cut production and it means some hog farmers will go out of business. It all depends on how consumers react and how long the trade bans go on and how widespread they are in determining if this will contribute to lower prices and how long lower prices last."
Another factor, he noted, is how long the trade bans go on and how widespread they are.
These actions will contribute to lower prices and how long lower prices last.
China and Russia implemented partial bans on imports of U.S. pork Monday.
“Countries often do this, but these decisions are not science-based decisions and pork is no exception,” Anderson said.
Labeling this disease “swine flu” is misleading, he said, adding that there’s no evidence that this particular strain originated from swine. People also can’t get the illness from eating pork, which is another misconception.
In 2008, the U.S. was the leading export marketer of pork and the world’s third-largest producer behind China and the European Union, Anderson said.
“Between beef, pork and poultry, pork is the most consumed meat in the world,” he said.
The following are some key facts about U.S. pork production, according to Anderson:
* The U.S. had 67.22 million hogs and pigs on feed as of March 1.
* Approximately 116.5 million hogs were processed in the U.S. in 2008.
* 23.4 billion pounds of pork were produced in the U.S. in 2008.
* U.S. per capita consumption in 2008 was an estimated 46.5 pounds, retail weight.
* Texas had a population of 1.1 million hogs and pigs as of Dec. 1, 2008.
* The U.S. is the world’s largest pork exporter, with a 39 percent market share in 2008.
*In 2008 the largest export markets for U.S. pork were Japan, China, Mexico and Russia in 2008.
*The U.S. also exported the equivalent of 20 percent of production in 2008.
“The pork industry has already had to endure record-high feed costs in 2008," Anderson said. “The industry has had to adjust to those added expenses by reducing production. Rapid, uninformed reaction to (recent reports of) influenza caused sharp declines in hog futures prices and the stock prices of pork-producing companies on Monday.”