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Hog Outlook: Market factors make prospects promising for 2023.

Kevin Schulz, Editor

February 13, 2023

3 Min Read
case of pork for sale in an international meat market
PORK STRONG: Pork exports ended last year on a positive note, leading industry experts to be optimistic about a favorable 2023.Courtesy of National Pork Board

Pork producers have had their share of uncertainty over the past decade among porcine epidemic diarrhea virus outbreaks, porcine reproductive and respiratory syndrome variations, and COVID-19’s impact on processing plants.

Now, according to a January report from Rabobank, a slowing global economy weighs on demand for pork, painting a picture of uncertainty and volatility in the swine industry.

As we all know, household budgets have been stressed with higher prices for goods across the board, and that includes food purchases. Rabobank analysts say pork is not immune to this pressure, but they indicate that pork may be able to weather this storm better than more expensive proteins.

According to the report, managing inflation remains a priority for many governments, requiring careful calibration of interest rates to maintain consumer and business confidence.

Glimmer of hope

There may be a glimmer of hope, but it may be just that — a glimmer.

Chenjun Pan, Rabobank Animal Protein senior analyst, says, “Trade is expected to increase modestly in Q1 2023, but it may find growth difficult to sustain through the year, given slow production in major exporting regions like the EU and U.S.”

The report points to the contrast that Brazil presents, with continued export growth last year, and is expected to increase production and exports again this year.

Whenever anyone speaks of the pork market, China has to be in the conversation. That is true here, as the hog industry in China and Southeast Asia continues to recover with production there on the upswing. Demand for imports should ease, particularly in the second half of this year, Rabobank reports.

“The timing and extent of a demand rebound is uncertain and will be uneven due to ongoing COVID waves, macroeconomic headwind and weak business confidence,” Pan says.

Though China is always a large market factor, Rabobank’s report highlights “several key factors to watch in Q1 2023 and beyond, including feed grain prices and volatility due to drought in Argentina, poor U.S. harvests, lower ending stock globally and demand uncertainties.”

Export value up

Recent USDA data compiled by the U.S. Meat Export Federation show pork exports finished lower year over year for 2022, but export value was the third largest on record, trailing only the highs reached in 2020 and 2021. Pork exports continued to gain momentum in December, led by another outstanding performance in Mexico.

Though down for the year, the USMEF report says pork exports finished 2022 on a decidedly upward trajectory as December shipments reached 244,718 metric tons, up 13% year over year and the second largest of 2022 (slightly below November). December export value climbed 14% to $687.3 million.

These results pushed 2022 exports to 2.67 million metric tons, down 8.5% from a year ago, while export value was $7.68 billion — down 5% from the record achieved in 2021. Exports of U.S. pork variety meat were the second largest on record at more than 530,000 MMT, while export value was record-high at $1.27 billion.

Best country in a supporting role …

Pork exports to Mexico set a volume record in December on the way to a record-breaking year in which exports increased 10% to nearly 960,000 MMT. Export value to Mexico soared 21% to $2.03 billion, topping the $2 billion mark for the first time.

“The Mexican market has been a star performer for U.S. pork for many years, but the 2022 results were truly remarkable,” USMEF President and CEO Dan Halstrom says. “In the face of growing competition in Mexico, the U.S. pork industry has expanded product offerings and found innovative ways to meet the needs of processors, retailers and food-service operators. In addition to Mexico, it is gratifying to see such a broad range of markets contributing to our recent export growth, making the prospects for 2023 very promising.”

About the Author(s)

Kevin Schulz

Editor, The Farmer

Kevin Schulz joined The Farmer as editor in January of 2023, after spending two years as senior staff writer for Dakota Farmer and Nebraska Farmer magazines. Prior to joining these two magazines, he spent six years in a similar capacity with National Hog Farmer. Prior to joining National Hog Farmer, Schulz spent a long career as the editor of The Land magazine, an agricultural-rural life publication based in Mankato, Minn.

During his tenure at The Land, the publication grew from covering 55 Minnesota counties to encompassing the entire state, as well as 30 counties in northern Iowa. Covering all facets of Minnesota and Iowa agriculture, Schulz was able to stay close to his roots as a southern Minnesota farm boy raised on a corn, soybean and hog finishing farm.

One particular area where he stayed close to his roots is working with the FFA organization.

Covering the FFA programs stayed near and dear to his heart, and he has been recognized for such coverage over the years. He has received the Minnesota FFA Communicator of the Year award, was honored with the Minnesota Honorary FFA Degree in 2014 and inducted into the Minnesota FFA Hall of Fame in 2018.

Schulz attended South Dakota State University, majoring in agricultural journalism. He was also a member of Alpha Gamma Rho fraternity and now belongs to its alumni organization.

His family continues to live on a southern Minnesota farm near where he grew up. He and his wife, Carol, have raised two daughters: Kristi, a 2014 University of Minnesota graduate who is married to Eric Van Otterloo and teaches at Mankato (Minn.) East High School, and Haley, a 2018 graduate of University of Wisconsin-River Falls. She is married to John Peake and teaches in Hayward, Wis. 

When not covering the agriculture industry on behalf of The Farmer's readers, Schulz enjoys spending time traveling with family, making it a quest to reach all 50 states — 47 so far — and three countries. He also enjoys reading, music, photography, playing basketball, and enjoying nature and campfires with friends and family.

[email protected]

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