Rising feed costs reduce profitability of pig farming in Brazil

Brazilian pork producers are facing weaker financial performance as feed costs continue to rise. According to the Center for Advanced Studies on Applied Economics (Cepea), pig farmers’ purchasing power relative to key feed ingredients—corn and soybean meal—fell to multi-year lows in July.

The sharpest decline has been recorded for soybean meal. Purchasing power has decreased for the fourth consecutive month, reaching its lowest level since January 2024. The situation in the corn market also remains challenging, with the indicator dropping to its lowest level since the beginning of 2023.

In São Paulo state, prices for live hogs, corn, and soybean meal all increased slightly in July. However, feed costs rose faster than hog prices, leading to lower profit margins for producers.

The market is also under pressure from an oversupply of market-ready pigs. This is limiting further increases in hog prices despite steady pork demand during the first half of July.

Analysts note that the profitability of pig farms will largely depend on developments in the feed market. If corn and soybean meal prices continue to rise faster than live hog prices, financial pressure on producers is likely to intensify.