The “P” word has returned to the hog industry vernacular.

Profitability is back in view with a number of factors in the industry’s favor, according to the recently released Rabobank Global Pork Quarterly report.

Stabilization of sow herd contraction, lower feed costs offsetting other cost inflation and pork’s position in a value-conscious market are seen as the top global issues this year.

Upon release of the report, Christine McCracken, senior analyst, animal protein at Rabobank, says, “The industry’s improved supply-demand balance has led to a slowdown in herd contraction. Although meaningful growth in the breeding herd is not anticipated until late 2024 or early 2025, productivity enhancements are contributing to increased production.”

While the U.S. spring planting season is underway, growing conditions will be scrutinized to assess the impact on feed costs. The Rabobank report indicates that “a robust South American crop has further pressured prices, providing some relief from other inflationary costs.”

Pork traditionally battles with beef and poultry for meat-case supremacy, but the Rabobank report says pork is positioned as a cost-effective protein choice for the global consumer.

“This is particularly significant in light of rising beef prices. The trend toward frozen products and home cooking is expected to continue bolstering retail pork sales, with a projected uptick in value-added and processed meat sales as inflation rates peak,” according to McCracken.

Exports steady

The volume of March U.S. pork exports, the latest data available from USDA, is holding steady with last year’s totals, but the value is higher for the third month of 2024.

U.S. Meat Export Federation compiles the USDA data, and reports that pork exports totaled 260,430 metric tons in March, up 0.1% from a year ago, The exports are valued at $740.8 million, which is up 2% year over year and are the seventh-highest on record.

South Korea is a shining spot, as the shipments of U.S. pork in March to the Asian country were among the largest on record. According to the USMEF, exports also increased substantially to Central America, Colombia, Oceania, Vietnam and Malaysia. Pork export value per head slaughtered averaged $70.85, the highest in nearly three years and the fifth-highest on record.

“Another strong month on the pork side, and one that illustrates the importance of export market diversification,” USMEF President and CEO Dan Halstrom notes in a release. “Shipments to Mexico cooled a bit, reflecting the earlier timing for Easter, and yet the global total remained very robust through increases to Korea, Colombia, Central America and Australia. When export value exceeds $70 per head slaughtered, that’s welcome news for pork producers and the entire supply chain.”

Pork producers have grown accustomed to cautious optimism, and Rabobank lists factors to keep a close eye on moving forward:

As with most any issue, there are two sides to the story. So, while profits are returning to the picture, don’t lose sight of events outside the farmgate.

Schulz, editor of sister publication The Farmer, grew up on the family hog farm in southern Minnesota, before a career in ag journalism, including National Hog Farmer.