The price outlook for the global pork market for the first two quarters of 2014 appears steady, according to the Rabobank Pork Quarterly first quarter report. The price outlook, combined with lower feed costs, points to a profitable year for pork producers, but the unknown impact of porcine epidemic diarrhea virus (PEDV) in the United States, Canada and Mexico leads analysts to remain cautious.
"The main wildcard in the global market this quarter is the effect of PEDV outbreaks in North America and what this means to pork production in and export from this region this year," said Rabobank analyst Albert Vernooij. "Rabobank expects the impact in the U.S. to be more severe than forecast by the USDA and believes it will likely hamper U.S. pork production growth into 2014. This might also pressure U.S. export volumes, presenting opportunities for the other exporters."
PEDV, which has no known cure and can have a 100 percent mortality rate in piglets, was first confirmed in the US and Mexico in 2013. The first cases in Canada were confirmed in January 2014.
Korean, UK pork markets see positive signs
Adding to a positive global outlook for pork in 2014 is the recovery of the Korean pork market, which had been severely hampered by a swine fever outbreak that began in 2009. The recovery reported in the second half of 2013 is expected to carry over into 2014, Rabobank reported.
A positive financial situation is also expected in 2014 for the EU pork industry. Lower feed costs and continued elevated price levels will support the recovery of margins.