The past two months have been brutal for the hog industry, but there are some signs that the climate is improving.
Packing plants that were shuttered or partially shut down due to the number of employee illnesses related to the COVID-19 pandemic are gradually starting to come back on line.
“For the week ending May 2, capacity was down 35% from a year ago,” says Lee Schulz, Iowa State University Extension livestock marketing economist. “The next week we were down 24%. It’s improving pretty quickly.”
However, he says that has done little to reduce the backlog of hogs in the country.
“We have seen 2.133 million fewer hogs slaughtered over the last five weeks,” Schulz said May 20. “So we aren’t even working on the backlog yet.”
Because of the marketing delays, many producers are changing rations to maintain weight, rather than to gain weight. Despite this, Schulz says slaughter weights have been up.
Hog prices have also bumped up slightly over the past two weeks, and while that’s positive, Schulz says finding a marketing destination remains a challenge.
“Producers are doing all they can to manage the pigs on the farm,” he says. “We have seen some modest euthanasia, and the longer we have these pigs on the farm, it’s going to get more dire.”
As packing plants increase production, changes are being made to keep workers safe. This could cut into capacity slightly, Schulz says.
“We have heard anecdotally that changes have been made in the fabrication process,” he says. “The plants are concerned with worker safety. How much this reduces capacity is unknown at the moment.”
Pork exports were strong over the first quarter of 2020, but those numbers will likely be lower once April figures are put together by the USDA.
Maria Zieba, director of international affairs with the National Pork Producers Council, said exports over the first quarter were up nearly 40% from a year ago, a number driven primarily by more pork being shipped to China.
“We weren’t exporting a lot of pork a year ago, mainly because of the retaliatory tariffs,” she says. “But with the phase one agreement and the higher demand, we are exporting more.”
Zieba says COVID-19 has not resulted in export restrictions specifically, but says countries with strict lockdowns are buying less meat.
“South Korea started with COVID-19 at the same time as the U.S., but they have a strict stay-at-home order,” she says. “Because people aren’t going out, we have seen a big drop in exports. The same is true with Colombia.”
Despite the drop in packing capacity, Zieba says pork remains plentiful.
“We have been able to meet demands for both consumers and the export market,” she says. “We are exporting a lot of things we don’t consume as much of here, such as hams and variety meats. We have plenty of pork for everyone.”