Two Piglets Looking at CameraLooking ahead to the new year, economists agree that the price of pigs likely won’t spur many challenges for pork producers. This is according to favorable data in the recent USDA Hog & Pigs Reports. However, even with a strong supply and demand balance, producers will likely still face a whole different set of challenges. Farm biosecurity and the threat of African swine fever (ASF) still remain on high alert. A static sow herd, ever-tightening balance sheets due to high feed costs, increased pressure from South America and acreage changes due to renewable diesel demand also are cause for concern in 2023 as well. While pork demand has been impressive, forecasts hint there will be a slowdown in the general economy which could become an issue for domestic pork prices.

Inflation costs were a major headwind for producers this year and will be again in 20223. An Iowa State University model for farrow to finish production showed costs increased 27% or $17/carcass cwt in 2021 compared to 2020. Costs increased an additional 18%, or $15/carcass cwt in 2022 compared to 2021.

Read more on 2023 pork production and profitability here.