Strong Pork Prices Expected in 2011

Strong Pork Prices Expected in 2011

Hurt predicts record highs.

Purdue University Extension economist Dr. Chris Hurt, predicts hog and pork prices will launch to record highs in 2011 due to a combination of high demand, high feed costs, and a smaller herd. Foreign buyers are expected to elevate pork exports by 10%, representing a record 21% of domestic production. As a result Hurt predicts this year that the available supply per person in the United States will drop by nearly 3%. That will cause consumers to face record retail pork prices.

For producers, Hurt predicts live hog prices to exceed $60 per live hundredweight, or more than $80 on a lean basis. Historically a $90 lean price, or about $67 live, was the top of futures markets. Some current futures prices now exceed $90 for the spring and summer delivery contracts and raise the possibility of them reaching $100, or $75 live.

The Purdue economist notes that a new era of high costs probably means there will eventually be a new era of record high hog and pork prices. According to Hurt feed costs aim toward a break-even year with costs estimated to be slightly over $60 as well. So, there will be no great profit prospects during 2011.

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