Pork virus: No real impact to prices expected

The Porcine Epidemic Diarrhea Virus, also known as PED, that has infected swine farms in Arkansas and 13 other states is not expected to have a major impact on hog supplies or pork prices in the coming months, according to several swine experts who spoke with The City Wire this week.

Tyson Foods, one the nation’s largest pork processors, purchases hogs from about 2,700 independent suppliers. The Springdale-based meat giant processes roughly 403,000 head of swine each week in its nine pork facilities located throughout the central and Midwest part of the U.S.

“So far, we’ve received very few reports of our hog suppliers’ animals being affected by this disease,” said Gary Mickelson, Tyson spokesman.

Dr. Mike Tokach, extension swine specialist with Kansas State University, said PED was formerly believed to be contained in Europe and China, until the disease was first detected on U.S. soil around April 19. Since early May hundreds of piglets have died across 15 states, but the extent of the spread is difficult to determine because outbreaks are not required to be reported to federal officials.

The American Association of Swine Veterinarians said PED has been found in the following states: Arkansas, Iowa, Illinois, Indiana, Kansas, Michigan, Minnesota, Missouri, North Carolina, New York, Ohio, Oklahoma, Pennsylvania and South Dakota.

Tokach said the virus is serious for hog farmers because baby pigs can rarely fend it off as it often wipes out the intestines with a fairly high mortality rate. He said it’s hard to determine just how many piglets have died. Tokach said PED is complicated by the fact it breeds in heat and bright sunlight, unlike other related swine viruses.

“There has been some tracking from the different diagnostic labs. The American Association of Swine has a tracking how many cases … of the known farms that have experienced the disease. The number is 69 or 70 farms to date, but the number is going up," Tokach said.

Dr. Jeremy Powell, veterinarian with the University of Arkansas Department of Animal Science, doesn’t see any major concerns in the Natural State.

"I don't think we have that many pork producers left in the state. That's something that's been leaving the state for several years now," he said.

Powell and other experts stressed that PED poses no risk to humans who consume pork, or raise swine.

CONSUMER PRICES
Despite some reports of higher pork prices on the horizon, the experts who spoke with The City Wire don’t see much of a threat given the timing of outbreak.

Piglets born in the spring and early summer would be going to market in the late fall to early winter months, which is also typically the weakest cycle for pork prices throughout the year.

Steve Kay, publisher of Cattle Buyers Weekly, said in recent months there have been too many hogs slaughtered relative to demand, which kept packer margins in the red, and pork prices quite low.

“Packer margins for fresh pork did turn back into black in later June, but I suspect packers have been making money most of this year on their valued-added products.” Kay said.

Tokach agreed, saying any supply chain issues probably have not impacted enough pigs to drive up pork prices in the coming months. That said, hog futures have rallied the past week or so on speculation of tighter supplies after reduced slaughter numbers were reported out of Iowa, the nation’s top pork producing state.

Carcass weights also dropped slightly at the same time grocers increased orders in hopes of more summer grilling by consumers.

Wholesale pork cutout prices were $1.03 per pound last week, up 15% from a year ago. Even with that increase, pork is $2 cheaper per pound than the all beef wholesale price of $3.14 as reported by the U.S. Department of Agriculture.