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Seasonality and exports pushing prices higher

The volatility in the cash hog market continues as prices have been climbing off the lows earlier in the year.

Lee Schulz, a livestock economist at Iowa State University says seasonal production is a large factor.  “This is typically a time where you do see stronger prices as you get into summer with tighter supplies and tighter demand as you’re working through summer grilling and promoting pork to see strong demand.”

He tells Brownfield some buy-up from retailers and wholesalers ahead of the previously set July 1 implementation of Proposition 12 in California could be contributing to the higher push in prices, but it’s likely other factors. The California Department of Food and Ag recently announced it would delay the implementation of Prop 12 regulations another six months allowing producers more time to become compliant. “Exports -we’ve seen those stronger than what we’ve anticipated, so that’s been supportive of the pork market. I think it some of those fundamentals that we expected earlier in the year maybe coming to fruition now or getting more certainty now that’s been supportive of the hog market.”

Schulz says while prices have come off the lows earlier in the year — they are still below the projected levels.