US pork outlook: Will 2021 be different?

Source: Jennifer Shike, Farm Journal’s Pork, 14 December 2020, photo credit: BioSpace

Many people would like to push fast forward to 2021 and forget 2020 ever happened. Will 2021 be a better year for the U.S. pork industry? Most economists think so, but they’ll be the first to admit that’s what they thought last year.

The industry appears to be set for another year of large hog supplies that will stretch processing capacity and pork demand, says University of Missouri economist Scott Brown. Demand growth will need to continue in 2021 and any slowdown could make 2021 a tough year, he cautions.

“Keeping all the pieces in balance and working together is the key,” says John Nalivka, president of Sterling Marketing. “Capacity is more than just how much space you have to bring hogs into the plant and slaughter them, it also has to do with capacity beyond that – on further processing and fabrication.”

When everything is working really well, the highly efficient U.S. pork production system is great, he says. But as the industry saw in 2020, all it takes is one kink in that system to create upheaval. Although no one holds a crystal ball to shed light on exactly what a new year will bring, Christine McCracken, Rabobank executive director – animal protein, says, “The disruption of the past year gave everyone a preview of just how bad things can get when plants are closed, customers are lost, labor is compromised, or export markets are lost. For the most part, the industry came through the experience with a few bruises and limited lasting damage.”
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The South African Pork Producers’ Organisation (SAPPO) coordinates industry interventions and collaboratively manages risks in the value chain to enable the sustainability and profitability of pork producers in South Africa.