According to Rabobank’s Q4 Pork Quarterly, pork prices in Q3 reported double digit increases across almost all production regions. Prices declined at the end of Q3 because of summer heat, but prices are expected to remain high through the rest of 2013 driven in part by tight supply in the U.S. due in part to outbreaks of porcine epidemic diarrhea virus (PEDV). Despite the positive outlook farmers are reluctant to increase production – waiting instead to regain some of the lost margins of the past few years first. Slow herd rebuilding will occur going into 2014 resulting in higher supply and lower price, albeit slowly. China’s import demands have been exerting influence on prices and Shuanghui’s acquisition of Smithfield, the world’s largest pork company, is another sign of China’s dominance in the sector.
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