Rabobank’s latest Global Pork Quarterly Q4 2024 report offers insights into the state of the global pork industry as producers navigate a complex landscape of profitability and ongoing market challenges. Despite the current profitability in some regions, many pork producers remain hesitant to expand their herds. The report, led by Christine McCracken, senior animal protein analyst for RaboResearch, emphasizes that trade dynamics, disease pressures, and shifting demand patterns continue to hold back significant herd expansions. Here’s an overview of the key insights from the report, highlighting trends and factors likely to shape the pork industry as we move into 2025.

Stable Sow Herds with Little Expansion

Global pork producers have shown restraint in herd expansion despite moderate profitability, with global sow herds holding steady through Q3 of 2024. Christine McCracken points out that while certain regions have benefitted from profitability, expansion has not occurred at significant levels due to concerns over health, regulatory, and consumer demand challenges. A seasonal production boost is anticipated as temperatures drop and fresh corn becomes available, yet herd health issues are expected to rise in parallel.

Rising Disease Pressures

Rabobank underscores biosecurity as a leading priority for pork producers worldwide. Disease outbreaks, notably in South Korea, Russia, and parts of Europe, have resulted in production losses in the latter half of 2024. The report forecasts that China, where disease pressures are easing, may see herd growth recovery in 2025. Despite these challenges, production increases are expected in the U.S., Brazil, and Southern European countries, albeit cautiously.

Regional Challenges and Regulatory Hurdles

In the U.S., limited slaughter capacity poses a constraint, potentially limiting production growth even as pork demand remains solid. Meanwhile, European producers face regulatory pressures that could affect production costs and expansion feasibility. Rabobank’s report underscores that these challenges, coupled with evolving consumer sentiment, make decisions on herd expansion difficult for many producers across various regions.

Trade Uncertainties: Regionalization and Policy Shifts

The report highlights significant shifts in global pork trade due to political changes. Recently elected administrations in Mexico and Japan, along with the impending U.S. election, may drive shifts toward regionalized trade policies. These changes, combined with China’s anti-dumping action against the EU, illustrate the uncertain trade environment that pork producers face. Rabobank cautions that pork producers will need to stay agile and diversify both their markets and supply chains to cope with potential trade disruptions and build domestic demand.

Feed Production and Costs

While global feed inventories have improved, Rabobank analysts caution that regional disparities persist. Dry conditions in South America have delayed soybean planting in Brazil, which could impact corn acreage for 2025. In contrast, North America’s large harvest has contributed to stable feed stocks. McCracken expects that this favorable feed cost environment will persist, offering moderate cost advantages for pork producers in specific regions.

Logistical Challenges and Weather Concerns

Logistics continue to challenge the pork industry, with recent labor strikes and weather-related issues impacting distribution. Rabobank anticipates that a La Niña winter could further disrupt global logistics, affecting feed and pork supply chains alike. As producers grapple with these hurdles, efforts to ensure stable supply chains are likely to be top-of-mind for 2025.

Consumer Confidence and Demand Trends

Looking ahead, Rabobank points to consumer confidence as a critical factor that will shape global pork demand. Economic difficulties in various regions have affected pork consumption, and analysts will be closely watching consumer sentiment as we enter 2025. Market dynamics and pricing, influenced by economic conditions, will be crucial in determining global pork consumption patterns and prices in the coming year.

Conclusion

Rabobank’s Global Pork Quarterly Q4 2024 report highlights a cautious yet resilient pork industry navigating profitability amidst significant external challenges. As producers weigh decisions on herd expansion, they must consider factors ranging from biosecurity and regulatory challenges to feed costs and evolving trade policies. While some regions are poised for moderate growth, trade uncertainties, disease pressures, and consumer sentiment will likely define the trajectory of the global pork industry as it heads into 2025.