WASHINGTON — While consumers started to see the effects of the drought on retail food costs in the last quarter of 2012, pork prices dropped and are expected to stay low through most of 2013.
The U.S. Department of Agriculture’s Economic Research Service found consumer pork prices fell over 3% from October to December 2012.
In addition, the National Pork Board said pork prices in the fourth quarter were down 2.4% compared to the same period the previous year, according to data from FreshLook Marketing.
“You know, supply was good last year. I mean, there was all that talk mid-summer about the hog market contracting and all that, but by the time the drought really took hold, the animals that were on the ground were going to come to market one way or another,” said Patrick Fleming, director of retail marketing at the National Pork Board.
October is usually when hogs come to market, and September and October this year saw a particularly high volume of hog sales, he said.
At the same time, pork exports dropped.
“And exports were strong [in 2012], but they tapered off a little bit in the fourth quarter. That left a little bit more product to be sold domestically,” said Fleming.
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Sales during the fourth quarter were up 3% by volume and 0.5% in dollars, according to FreshLook data, driven by low prices and retailer promotions.
“Pork roasts were a really nice value for the holiday season. And retailers could still make money,” said Fleming.
Retailers continued those promotions in the first quarter of 2013, including deals on back ribs for the Super Bowl.
That value has continued into the first quarter so far, according to Fleming.
“And honestly, we don’t see that changing most of this early part of the year,” he added.
Pork prices should remain low throughout 2013, barring another bad harvest pushing up feed costs, which could have ramifications for pork later in the year, Fleming said.
“But now through Labor Day, we’re looking at good supply. [There] still should be a really good value for retailers and consumers. It should be a year for pork to shine, from a sales perspective.”
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