News

COVID-19 could create long-term changes to the pork industry

The pork industry continues to try and work through the backlog of hogs in the supply chain caused by the coronavirus pandemic.

But, RaboReserach senior animal protein analyst Christine McCracken says it will take some time before the pork industry will be able to maximize the value of the carcasses.   “Most packers that we’ve talked to have the labor to harvest,” she says.  “But what they don’t have is enough people to harvest and debone and trim and work the Cryovac and get it all in a box and to the retailer in a form they want.”

She says slaughter levels are beginning to normalize, but the slow-downs have left around 2-million-hogs backed up at the producer level.  “There are some concerns that plants may not be able to consistently operate at peak levels,” she says.  “And we are seeing some liquidation.”

In the long-run, McCracken says the pork industry will likely see an increase in efficiency.  “We are taking out these least productive animals and farms with ongoing disease issues,” she says.  “I do think that there’s going to be a shift toward even higher productivity which has to be factored in.  It may even offset the early liquidation that we’ve seen.”

Pork processing has recently been running about 75 percent of daily capacity.