Beef, pork prices to rise in 2020: FCC

Beef and hog farmers should have a better year in 2020, unless China gets in the way, according to a Feb. 19 Farm Credit Canada economic forecast.
Demand should support profitability in 2020. Livestock prices for beef and hogs are expected to increase from last year but stay below the five-year average. With feed prices expected to stabilize, that means profitability should improve slightly, as strong demand for beef should be enough to buoy cattle producers, the report said.

In the hog sector, increased demand in China for pork should more than offset both the increase in U.S. pork production and tariff reductions on U.S. pork. China lost as much as two-thirds of its hogs to African Swine Fever last year, according to an estimate from Global AgriTrends president Brett Stuart.

The biggest question is how quickly China will rebuild its hog herd. If they rebuild quickly, hog demand will drop. China accounts for 27 per cent of all meat consumption worldwide, most of which is pork, but historically only imported about three per cent of its pork, FCC said.

The other complicating factor is the novel coronavirus outbreak. If concern about the disease weakens market confidence and slows income growth, that should have a proportional impact on demand for red meat, FCC said.