2023 is a year that will be forever etched in producers’ minds, marking the worst year for profitability on record. Economists say 2023 proved to be even more severe than 1998, a year that caused many pork producers to go out of business.
“What hasn’t changed is 2023 was the worst year ever for profitability for our pork producers,” says Lee Schulz, chief economist for Ever.Ag. “Now, what has changed is 2024 was better than forecast, so you can call it roughly breakeven. And 2025 is looking to be a modest level of profitability in that $9 to $10 per head range as market currently sets today.”
2024 produced a slightly better picture, but even then, pork producers across the U.S. are still recovering from a painful 2023.
“There’s a lot of financial healing needing to be done before we really even talk about any meaningful expansion in the industry,” Schulz says.
Even with what Schulz sees as modest profitability for producers today, that improvement is helping paint a better picture — and outlook — for the pork industry in 2025.
“I think this could be the quickest turnaround in pork producer profitability ever, but that also speaks more to what 2023 was and how bad it was than it does about current and future profits,” Schulz says.
Still in Recovery Mode
The Ever.Ag chief economist’s forecast points to another tough reality: Producers won’t get back to break-even levels on their balance sheets until August of this year, a testament to just how steep losses were in 2023.
“There were a lot of losses that need to be covered before we actually start seeing profit,” Craig Andersen, a pork producer located in Centerville, S.D., told Farm Journal’s Michelle Rook. “The pigs are profitable right now, but to make up for the losses, it’s going to take a while to recover from some of that.”
The pork industry is in a recovery phase, but pork producer Terry Wolters told Rook at least it’s improving, as profitability is at least on the horizon this year.
“I think without question, lower grain inputs are a significant help to the livestock producer right now,” Wolters says. “You see the board is trading higher, cutouts have been good, pork demand in general has been good and exports have been good. So, a lot of positive things on the meat side of the industry.”
Another Bright Spot: Robust Pork Exports
U.S. pork exports have been nothing short of impressive. The final 2024 export data from USDA shows U.S pork exports hit record levels last year.
“Not only did we break export volume records, but we broke export value records,” Schulz says. “If you think about it, one way that we know we had an increase in demand was our customers worldwide ate more pork, and they paid higher prices for it.”
U.S. Meat Export Federation says 2024 pork exports reached a record 3.03 metric tons, beating out the previous record set in 2023 of 2.98 metric tons. Today, that historic growth isn’t driven by just one country, and that’s something Halstrom likes to see.
“Broad based growth is the name of the game there,” he says. “It’s really almost the entire world that exports are growing, led by Mexico, Central America, South America, places like Colombia are booming.”
Related Story: U.S. Pork Exports Break Records at $8.63 Billion in Value for 2024
Halstrom says even places like Korea are seeing vigorous pork exports, a trend he forecasts will continue in 2025.
“It’s a pretty good story on pork and going into 2025,” Schulz says. “It’s a much different supply situation on pork versus beef with a lot of potential to grow and set a new record, and we’re forecasting another new record in 2025 for pork.”
Shulz is also optimistic on pork exports in 2025.
“Why also I remain very bullish on U.S. pork exports is 2024 was the first time that the U.S. had surpassed the European Union since 2014 on pork exports,” Schulz says.
Tariff and Trade Concerns
But the one concern — and caveat — is what happens with tariffs.
“They’re not going to stop trade,” Schulz says. “They have the potential to slow trade. When you think about it from a short run impact, there’s reasons why we’ve developed the relationships and we have the product flow that we have. So it’s very difficult in the short run to move and build those relationships to a wide volume. What will happen, however, is pork will become more expensive for those customers, and that’s going to impact trade. But the impact is longer term, I think, in the worry of how long those tariffs last.”
The tariffs are injecting uncertainty into outlooks, but that’s not the only piece that has the pork industry on edge.
“I think the other one that continues to add to the uncertainty is just about the impact of disease out there and how large, widespread an impact that’s having on production,” Schulz says.
Little to No Expansion in the Pork Herd
He says prices have not incentivized any expansion in the pork sector, but the disease piece of the puzzle is one that could sway production estimates in future USDA reports.
“That’s why, I think if you look at USDA estimates and Hog and Pig reports and the need to make some revisions, that’s come because there’s a lot of uncertainty just about the impact of disease and what that’s having on our hog numbers and pipeline supplies,” Schulz says.
Litter rates and carcass weights actually created an increase in pork production over the past year, Schulz points out. But the breeding herd remains flat.
“Another thing is our sow numbers were down in the U.S.; there’s a little bit of retraction in the sow herd,” Adam Annegers of JBS told Farm Journal’s PORK editor and brand lead Jennifer Shike on a recent episode of “The Pork Podcast.” “But if you look at overall production and wean pigs produced, we produced more pigs with fewer sows. There were several health challenges through some months in there, but the genetics that we’re working with have the potential to produce more pigs year over year, even with less sows out there. I’m excited about 2025. Pig markets are looking really good. It’ll be fun to see we can do this year.”
A Year of Stabilization
There’s excitement for 2025, as producers have worked to not outpace current demand, but there’s also caution of what lies ahead for trade and turbulence in the current tariff spats happening around the globe.
“I look at 2025 as stabilizing and maybe the start of a pivot to starting to see some moderate expansion in the industry going forward that we may start to realize in 2026 and 2027,” Schulz says.
As optimism continues to dominate conversations to start this year, it’s a reminder that pork producers find a way to persevere.
“One thing about our producers is they’re so resilient,” says Glenn Muller, executive director of South Dakota Pork Producers Council. “They’re going to come back. They’re going to find a way to survive in the meantime, and this is going to give them some opportunity to backfill some of those holes created due to the poor economy.”
