Pork producers know better than anyone that the market rarely cooperates with predictions. Heading into 2027, these economists aren’t promising certainty — but they are offering guidance worth factoring into the year’s game plan.
1. Control risk across the entire production chain.
“The producers who perform best in 2027 may not be the ones with the lowest feed costs, but the ones with the greatest control over their cost structure,” says Brian Earnest, lead animal protein economist at CoBank’s Knowledge Exchange. “That includes feed, labor, capital efficiency and increasing the security of their pig supply.”
One of the lessons learned from 2026 was that cost volatility doesn’t just come from feed markets. Tight breeding-herd inventories contributed to periods of sharply higher weaned and feeder pig prices, reminding producers that access to pigs can become a meaningful cost driver when supplies tighten, he adds.
“Volatility rarely shows up in only one place, so the most resilient operations will be those managing risk across the entire production chain,” Earnest says.
2. Understand your margins and protect them when the market gives you the opportunity.
“Producers have dealt with tremendous volatility in hog prices, feed costs and interest rates, and I don’t expect that volatility to disappear in 2027,” says Matt Erickson, senior research analyst at Terrain. “But volatility can create opportunity as well. Risk management is not about consistently predicting higher hog prices or lower feed costs. It’s about recognizing when the market offers an acceptable return for your operation and being willing to secure it.”
Higher interest rates have created a much different financial environment than what many producers experienced over the previous decade, he notes. He encourages producers to understand their cost of capital just as well as they understand their cost of production.
“Expansion will be tough for most producers, and generating a positive return is not enough,” Erickson says. “Whether considering a new barn, facility improvements or business expansion, producers should evaluate opportunities through bifocal profitability and return-on-capital lenses.”
3. Help the pork industry strengthen demand.
“Work with industry to strengthen the demand pillars, especially foodservice and exports,” says Altin Kalo, chief economist at Steiner Consulting. “Much of the conversation we hear about demand invariably focuses on retail, yet more meals are currently being consumed outside the home. There are opportunities to expand the footprint of pork at food service but that requires imagination and working closely with businesses rather than simply running retail marketing campaigns.”
4. Know your break-even and manage to it.
“Strong producers understand their cost structure, cash flow requirements and profitability targets throughout the production cycle,” says Chris Ford, vice president of corporate swine lending atFarm Credit Services of America. “That knowledge becomes the foundation for sound decision-making.”
Whether the risk comes from feed costs, hog prices or interest rates, decisions should be made within the context of protecting margins rather than trying to predict market highs and lows, Ford adds.
“Markets are difficult to forecast consistently,” Ford says. “Understanding your numbers is far more valuable. The most successful operations are rarely the ones that capture the absolute top of the market. They’re the ones that consistently identify profitable opportunities and avoid significant downside risk.”
5. Don’t assume today’s reality is permanent.
“Pork production profitability has always been cyclical,” points out Lee Schulz, chief economist with EA Risk. “Strong margins can quickly give way to periods of losses driven by changes in hog prices, production costs, disease prevalence or other factors outside producers’ control.”
When margins are bad, he says it’s easy to assume costs will stay high, demand will remain soft and prices won’t recover.
“But the hog market has never stayed in a downturn indefinitely,” Schulz says. “Every low-price cycle has been followed by a higher price cycle—sometimes sharply higher. The timing of which is uncertain though. Have a risk management plan that works even when markets move fast. Use tools and strategies that protect margins without needing perfect timing.”
6. Respect the “push” and “pull” of the market.
“Understand the industry ‘pushes’ pork onto the market in supply-side activities while consumers ‘pull’ pork into the market via demand-side signals,” says Glynn Tonsor, an agricultural economist at Kansas State University. “Appreciating the role of both and how said forces combine to give observed market outcomes would be healthy for all to better appreciate as we move into 2027.”
