CNS Canada — Canadian hog prices have been drifting slightly lower over the past few weeks but are showing signs of turning the corner, according to one industry expert in Saskatchewan.
Brad Marceniuk, a provincial livestock development specialist in Saskatoon, said he expects prices to stabilize in the next couple of weeks as slaughter numbers come back to Earth.
“It really impacts the price, because the cash market price in the U.S. determines what our cash price is here,” he said.
Saskatchewan Signature No. 3 cash slaughter weight hog prices declined C$2.89 per 100 kg, to average $124.17/ckg, for the week ended Saturday (Nov. 21).
So far this year, the number of Canadian hogs slaughtered was estimated at 18.44 million head, up 2.5 per cent from the same time in 2014.
The U.S. has been even busier. The weekly pork production of 510.5 million lbs. established a new weekly record, according to Marceniuk.
“So when (the U.S.) have record numbers of production and slaughter numbers they see numbers typically fall,” which in turn reflects onto Canadian prices, he said, noting hog exports in North America typically flow north to south.
“It’s not vice-versa; they typically pay higher prices for hogs and our price is whatever their price is less a bit of a basis. It doesn’t move back and forth.”
Marceniuk attributed some of the rush to the holiday season in the U.S. The low Canadian dollar, relative to its U.S. counterpart also helps increase interest.
Once Canadian prices stabilize, he said, they should move up slowly.
— Dave Sims writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.