Weekly Product Updates

W28: Pork Update

Frozen Pork Ham & Shoulder
United States
Published Jul 21, 2023

In W28 in the pork landscape, the United States Department of Agriculture (USDA) indicates that the 2023 global pork production forecast remains largely unchanged from the April projection, with an estimated 114.8 million metric ton (mmt) output. Increases in pork production from China, Canada, and Brazil are expected to offset decreases in the European Union (EU), Japan, the Philippines, and Mexico. The USDA also expects 2023 global pork exports to increase by 2% compared to the April estimate, driven by stronger shipments from the United States (US) and Brazil. This growth compensates for export declines from Canada, the United Kingdom (UK), and the EU. With reduced pork supplies in the EU, the US and Brazil have an opportunity to gain market share in Asian countries such as South Korea and the Philippines. Overall, strong demand from China has been beneficial for major pork exporters so far in 2023.

The USDA revised the US 2023 pork production forecast slightly downwards to around 27.37 billion pounds (lbs), a decrease of 5 million lbs compared to the June projection. This downward adjustment is primarily due to slower slaughter projections in Q2-23 and Q3-23. The USDA also anticipates an average barrow and gilt price of USD 57.90/hundredweight, an increase of USD 1.20. Additionally, higher imports and exports are expected, while per capita consumption is anticipated to be lower.

In Jun-23, pig prices in several regions of Brazil experienced a decline compared to May-23, resulting in month-on-month (MoM) average price decreases. In the São Paulo (SP)-5 region, pork prices fell by 8.6%, while Greater Belo Horizonte saw a devaluation of 7.4%. In the South region, prices dropped by 7.6% in Western Santa Catarina and 4.4% in Southwest Paranaense. Compared to Jun-22, prices remained relatively stable or even slightly higher despite these declines. The decrease in prices is attributed to a high hog supply ready for slaughter and ample meat availability. On the other hand, Brazilian pork exports increased in Jun-23, reaching the highest volume exported so far in 2023, driven by stronger demand from China, the Philippines, and Hong Kong. However, Mexico reduced its purchases during Jun-23. Pig farmers in São Paulo experienced a decrease in purchasing power due to the decline in live hog prices, despite the drop in corn and soybean meal prices. Overall, the market conditions for Brazilian pork exports have improved, with Brazil gaining space in the global markets due to the recognition of its biosafety standards.

Lastly, the National Animal Health and Quality Service (Senacsa) reports that Paraguayan pork exports in the first six months of 2023 reached 14.88 thousand metric tons (mt) valued at USD 6.53 million. This is a six-fold increase in volume compared to the same period in 2022. This growth was primarily driven by the opening of Taiwan's market in 2022, accounting for 48% of Paraguay's exports. Senacsa foresees that 2023 could be a groundbreaking year for the Paraguayan pig industry. The Association of Pig Breeders of Paraguay (ACCP) is also exploring new markets, with Chile being a potential target due to its significant pork demand. However, qualifying for the Chilean market would require certain sanitary advancements and agreements between the two countries. Despite the challenges, exporting to Chile would greatly benefit Paraguay's pork sector.

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