Saskatchewan Agriculture and Food says a combination of factors will keep hog prices volatile with some strengthening as we move toward spring. Brad Marceniuk said while live hog prices have continued to fluctuate, they have improved since the beginning of February when higher U.S. slaughter numbers and higher volumes of chicken and pork in cold storage pushed prices down.
“The key factors are U.S. hog slaughter numbers, the demand for pork, U.S. meat in cold storage and the Canadian dollar,” said Marceniuk. “Lower hog slaughter numbers in the United States over the last few weeks have been positive on US hog prices. The demand for pork in the U.S. has been weakening over the last few months which have been negative for hog prices.”
With chicken in cold storage up 46 percent year over year and pork stocks up 23 percent from December, increased meat supplies have put pressure on prices. In Canada, the strengthening Canadian dollar has been negative for local prices and will continue to put downward pressure on hog prices if the dollar continues to get stronger compared to the US dollar.
Marceniuk notes February Statistics Canada figures show the total inventory of hogs in Canada as of January 1, 2006 fell slightly from one year earlier. Canadian production has levelled off, remaining relatively flat in 2005, with little growth expected in 2006 and shouldn’t be a major influencing factor on prices.