Almost every piglet born on Craig Rowles’ hog farms near Carroll, Iowa, died from the virus that swept through his herds in November, causing $462,000 of lost revenue in the first month of the outbreak. By the end of February, he expects to lose 15,000 animals, or 10 percent of annual sales.
U.S. hog farmers should “think twice” before expanding herds because too much supply may create a “bottleneck” in 2013 that would send prices lower, said Steve Meyer, the president of Paragon Economics.
U.S. beef production is plunging to a 21-year low after surging feed costs spurred ranchers to cut herds, signaling record prices for consumers and higher costs for buyers from McDonald’s Corp. to Ruth’s Chris Steak House.
U.S. hog producers may start to cull herds as the faltering economic recovery curbs pork demand and tightening corn inventories boost livestock-feed prices, curbing animal supplies and increasing costs for meatpackers.
Meat prices are poised to extend a 14 percent rally this year that drove U.S. retail costs to the highest levels since the 1980s as surging corn futures prevent livestock producers from expanding their herds.