U.S. hog production trailed expectations in the early fall, with weekly average hog slaughter down 2% year over year due to tighter supplies than expected. Rabobank says this shortfall mirrors the latest USDA Hogs and Pigs Report that says second-half 2025 inventories are below earlier projections.
In the North American Agribusiness Review, analysts say this reflects ongoing health challenges the industry is facing with porcine reproductive and respiratory syndrome (PRRS) remaining a drag on industry supply.
The September Hogs and Pigs Report also suggested limited growth in the sow herd with kept for breeding numbers under 6 million head, down again from the previous year. Rabobank says this combination of limited sow herd growth and health challenges is expected to keep supplies tight into early 2026.
Pork Prices Ahead of 2024 Levels
Rabobank notes pork prices remain well ahead of year-ago levels and the five-year average, driven by tight supplies.
“Cutout values of $109/cwt are currently averaging 15% above last year, driven by the ongoing strong demand for processing items like ham, as well as higher rib and picnic values,” the report says. “Trim prices also remain elevated on tighter supplies.”
Exports Are Down
With pork exports dropping slightly in July, down 0.8% year over year in volume and 4% in value, Rabobank attributes this to slower exports to Mexico and a drop in exports to Canada. Still, shipments to other top markets in China and Japan have remained flat.
“Exports to South Korea were robust (up 22% year over year) and driven by local supply shortfalls,” Rabobank says.
Total export volumes were down 4% through July at 1.7 million metric tons, with shipments to most top markets lower, the report says.
A Bright Light
“Mexican hog prices have strengthened in response to tighter hog supplies and firm packer demand,” analysts say. “Live hog prices remain high at MXN 47 per kg, up 21% year over year, as ongoing health challenges in key growing regions continue to constrain supply.”
Rabobank reports that despite efforts to improve biosecurity, pork production is expected to decline 3% to 5% in 2025.
“Slowing economic conditions are also putting pressure on pork consumption, despite falling prices and the high cost of competing beef products,” the report says. “Packer margins remain under strain due to elevated hog costs, inefficient plant utilization, and high labor costs.”
To fill the supply needs, imports are expected to stay strong and were up 10% year over year through August.
