The US hog industry has reduced production by about half the amount necessary to stimulate a rebound in live hog prices, estimates agricultural economist with the University of Missouri, Ron Plain.
Hog producers in the US have lost money in 20 of the last 22 months and losses in Canada have continued even longer.
Plain states a stronger world economy and more demand for pork and more exports would help and probably, what’s more realistic is to cut back on production, tighten up supply of pork and push up prices that way.
Swine herd reductions in Canada have been much more significant than in the United States, with the Canadian breeding herd down roughly 6% compared to a year ago. The US sow herd is not quite 3% smaller. The US probably needs to down-size its sow herd by about 10%.
Dr. Plain notes, because the US industry is three times the size of that in Canada, a cut in Canada doesn’t move us as far toward getting the total pork supply down as is the case when we reduce numbers in the United States.