The August WASDE report lowered its estimate for 2026 U.S. pork production by 79 million pounds to 27.876 billion pounds as a result of slower slaughter speeds and lighter third-quarter carcass weights. Pork exports were also reduced to 7.175 billion pounds, while ending stocks increased slightly to 445 million pounds. Lee Schulz, chief economist at Ever.Ag, said he uses the WASDE report as a benchmark to help frame production expectations. He acknowledges the lower production in the 4th quarter compared to the 3rd one.
From a revenue perspective, Schulz said producers should consider the price forecast. While production levels are similar to a year ago when viewed from a slaughter standpoint, the price outlook will ultimately play an important role in determining revenue.
As you look at expenses in a hog operation, Schulz said it’s important to focus on non-feed variable costs, which include many of the inflationary expenses.
In the big picture, Schulz said producers have been incentivized to increase hog weights with more value and profit margin per animal, pending slaughter capacity.
