What got us talking from the National Pork Industry Conference and recent trends?
This month saw the annual industry event, the National Pork Industry Conference, held in California, USA. This is the flagship global pork conference of the year, with social elements and family fun thrown into the mix rather than solely an industry-focussed programme.
What we have read and heard as the important outcomes and topics of conversation from the conference are as below:
Pork Exports: The first half of the year was said to be slow, but now has a silver lining as the US industry have rebounded exports to what may be double-digit gains year-over-year. Volume movement to Mexico is said to be one of the victories of change over the past 6 months also. The US pork industry enjoys a strong Peso relationship to the dollar so long may it continue! While domestic consumption is still three times as high as that of exports, but this is a beneficial development. In other territories, Canada has resolved their port strike which should lead to exports being back on again via water off the west coast.
Prop 12: This is a major front-of-mind topic this year - as Prop 12 now has more clarity of rules but less understanding of ramifications. The proposed EATS Act that would usurp the state mandate, and will take time but the general tone of the language looks to remain intact. GMA hope that this is good news for the pork production community and, possibly, wider agriculture, by providing a balanced and fair playing field.
Grains: The USDA last week lowered its yield forecast for corn and there is an incorporation of an added 2 million acres from the June planting report, which only provided enough buffer to keep the growing crop going. Brazil is a major player in the export of soybeans, with their demand up 100% over the past decade in response to Chinese demand. This year, Brazil will export more corn than the United States and it is likely to remain on that trajectory.
Performance varies from region to region, but looking also at prices in the local market, explains Chenjun Pan, senior analyst of animal protein at Rabobank,
““in the U.S., demand was slightly below expectations to start the summer, as uncooperative weather and poor air quality challenged the start of the grilling season. And in China, pork consumption remains weak, due to the underperforming economy and heat waves across the country.””
For the second half of 2023, we expect global trade to be weaker than in same period last year, he says, as inventories of frozen pork are high in China due to weak consumption, pressuring pork imports.
In the meantime, we sit tight and hope for pig herd health improvement and continued appetite from consumers for pork. We look forward to sharing the outcomes in the second half of the year with you all in due course.