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Pork production is a low- margin business. Outside forces — interest rates, inflation, employment rate and consumer incomes, health of the general economy, fiscal policy and monetary policy — all influence pork producer profits.

The USDA’s December Hogs and Pigs report places the December 1 inventory of all hogs and pigs at 73.1 million head, down roughly 1% from last quarter and 2% from last year. The year-over-year decline is driven by a nearly 2% smaller market hog inventory, which is toward the bottom end of pre-report estimates, as the breeding herd is nearly 0.5% larger than a year ago.

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