World Perspectives
livestock

A Pork Story

The U.S. hog inventory on 1 June was 79.6 million head, up 5.2 percent from a year ago. The supply is likely to stay elevated through the rest of the year. As a result, hog prices are down 41 percent YoY. The elevated pork processing margin does not characterize profit but rather the difference between the hog acquisition price and the cutout value. The margin is declining as higher processing costs begin to subside. Still the herd greatly exceeds processing capacity. The number of animals over 120 pounds is also elevated versus a year ago, and these animals are much more challenging to process into the retail cutout. However, moving the carcasses into export is relatively easier. At the same time, Chinese pig prices are rising &ndash...

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From WPI Consulting

Weighing in on strategic realignment

WPI’s team was retained by the governing board of a U.S. industry organization to review a decision, reached by vote, to invest significant assets into the development and management of an export trading company. WPI’s team conducted a formal review of this decision and concluded that the current level of market saturation would limit the benefits of the investment. Based on WPI’s analysis and recommended actions, the board subsequently reversed its decision and undertook a strategic planning effort to identify more impactful investments. On behalf of numerous clients, WPI has not only assisted in identifying strategic paths but also advised their implementation.

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