Record hog slaughter will stress slaughter capacity and force down hog prices more than usual. If so, this year may turn out to be the most profitable one ever for hog packers.

Orion Samuelson covers a range of topics in his regular post-show conversation.

Although this year’s corn crop is likely to be large (and a welcome development for hog farmers), it is important to not grow complacent with the market. 

Lower feed prices should drop cost of hog production, but this decline is not likely to be sufficient to keep hog profits in the black. Cheap feed won’t do anything to boost hog prices, which may get very low this fall.

The big hog slaughter capacity gains arrive in 2017 and 2018 when three large, state-of-the-art plants open.

Given the uncertainty of profit margins in the hog market, the best risk management strategy may be to establish option positions that will protect against greater losses.

Editor’s Note: This column marks the final weekly “Market Preview” contribution from Steve Meyer. National Hog Farmer thanks Meyer for his columns over the last decade and the market insight he has provided for our readership...