Bill Alford, the general manager of h@ms Marketing Services in Winnipeg, MB said in a year-end interview the hog industry finished 2020 on an unseasonably high note regarding hog prices. But 2020 wasn’t a typical year. And to finish the year, averages in hog prices came back and were even higher than 2018 levels.  
“So as bleak as it looked in the summer, amid all the issues with packing plant disruptions due to COVID-19, it was a bounce-back year and production, North America wide was slightly up over the previous year.” 
When one industry person in the United States said there are about 30 per cent more pigs than America needs because of an uptake in Chinese production.  
Alford said that message goes back ten years, but things happen that somehow keep the Chinese buying more pork, but they like to buy it at a lower price. Much of North America’s growth worldwide was spurred on in 2019 when ASF (African Swine Fever) decimated the Chinese hog herd. Of course they had to replace those proteins, so the rest of the world expands. Ending 2020 on a positive note centered on a supply chain disruption early on re COVID-19 quickly eroded prices because of production cutback. The industry took some drastic actions, with the hog producers and packers owning many hogs.  
Back in April/May, there wasn’t the light at the end of the tunnel, and one way or the other, production dropped whether it be through sows not farrowing, that type of thing. And it created a drop in supply heading into the fall months.  
With some uptick in the economy those pipes emptied but filled back up again those supply chains.  
“So it’s just a very odd year where you get a counter-seasonal, no barbecue season, but yet still there was demand there. And there was a pull on it and a reduction in the supply of hogs lifted everything, including pork prices right through to live prices in the fall.” 
In 2021, he said optimism of the breeding herd from the USDA hog pig report down three percent. There is some skepticism with some of the numbers in that report moving forward. Still, as the economy gets back to normal, the US has historically low cold storage, 40 per cent below average, and that’s due to the uncertainty. But once things get more certain with COVID restrictions easing should see a pull from food service, restaurants, that type of thing to want to replenish stocks with, in this case, pork. So it’s a balancing act of supply and demand again, but so drastically and overnight yields to a volatile situation. 
With just in-kind processing and stocking, whether vegetables, fruits, primary ingredients, pork, it costs more to produce, and consumers pay more for their food. While the just-in-time system is efficient during good times, nobody plans for a pandemic and the weakness show up. Many countries start to look at stocking up and not being so reliant upon outside supply chains or imports. The vulnerabilities start to show. 
“It’s not such a straight line anymore, and that inefficiency increases and inflates prices.”  Alford said, the way many companies did business in the past might also change because travel budgets came way under this year. There are specific savings. And again, just even overhead costs of a business’ office space, that’s one big one everybody’s talking about, how many aren’t going to go back to the office. It may even mean a round of pay cuts because the employee saves money by staying home with the idea.  
“Back to this pandemic, to some degree everybody’s got to refill, storage, and supply chains it’s a timing thing now, like when we get into these vaccines, we’ll only get back to that normal, I guess,” he said. •
—By Harry Siemens