Brazil's hog industry is moving through a challenging 2026. The sector is facing mounting pressure on hog prices and producer margins, driven directly by an increase in animals available for slaughter and, consequently, a larger supply of pork in the domestic market.

Production remained strong throughout the year, culminating in July with a new monthly slaughter record. This further increased domestic pork availability and made a sustained recovery in prices more difficult.

Although Brazilian pork exports continue to post positive results in terms of shipment volumes, export growth has not been enough to fully absorb the surplus generated by domestic production. As a result, the Brazilian market remains well supplied, limiting price recovery and maintaining a challenging environment across the pork value chain.

Live Hog Prices Fall Sharply in 2026

Data from Safras & Mercado on average live hog prices in Brazil's Center-South region clearly illustrate the shift in market direction this year. After strong price gains in 2024 and particularly in 2025, the market began experiencing a gradual deterioration in 2026.

Last year, prices remained at historically high levels. Monthly averages ranged from R$7.43/kg in January to R$8.16/kg in September, supported by a more balanced supply environment and strong export performance.

By contrast, 2026 started at an average of R$7.72/kg in January, followed by consecutive declines. The average dropped to R$6.70/kg in February, R$6.59/kg in March, R$5.87/kg in April and just R$4.86/kg in August.

For U.S. readers, using an indicative exchange rate of roughly R$5.10 per US$1 on September 9, 2026, and 1 kilogram = 2.20462 pounds, August's R$4.86/kg is approximately US$0.43/lb. Currency conversions are provided only as a reference and do not represent the exchange rate prevailing when each original monthly price was recorded.

The magnitude of the decline becomes clear in the year-over-year comparison. While August 2025 recorded an average price of R$7.87/kg, August 2026 averaged only R$4.86/kg - a decline of approximately 38%.

Moreover, the current price is below the levels recorded in August 2020, 2021, 2022 and 2023, underscoring the intensity of the pressure on the market.

Brazil's Hog Slaughter Reaches Record Levels

The main explanation for this price behavior lies in the expansion of Brazilian pork production. Slaughter data confirm that the industry is going through a period of increasing supply.

Between January and July 2026, 30.51 million hogs were slaughtered, up 3.2% from the same period in 2025, when slaughter totaled 29.55 million head.

Growth was recorded in almost every month. January slaughter increased 2.4% year over year to 4.31 million head. February was up 4.1%, while March posted a significant 8.2% increase, reaching 4.50 million head.

April increased 2.2%, while June posted an even stronger 7.3% expansion, exceeding 4.43 million head. May was the only month to record a decline, falling 1.4% from a year earlier.

July was the standout month. Brazil slaughtered 4.72 million hogs, the highest monthly volume in the series presented. The result surpassed the previous record of 4.70 million head set in July 2025.

Beyond establishing a new milestone for the industry, the figure confirms that hog supplies remain on an upward trajectory, reinforcing downward pressure on live hog prices.

Southern Brazil Drives Supply Growth

The expansion becomes even more evident when examining Brazil's three leading pork-producing states: Santa Catarina, Paraná and Rio Grande do Sul.

Together, these states account for most of Brazil's pork production and all posted slaughter growth in 2026, reinforcing the abundant supply of market-ready animals.

In Rio Grande do Sul, slaughter totaled 5.998 million head from January through July 2026, an increase of 6.02% compared with the same period in 2025. It posted the fastest growth rate among the three leading producing states.

Paraná also maintained an upward trend, recording 6.120 million head slaughtered during the first seven months of 2026, up 4.96% year over year.

Meanwhile, Santa Catarina, Brazil's leading pork-producing and exporting state, reached 9.351 million head from January through July, an increase of 1.30% from a year earlier.

Despite the more moderate increase, Santa Catarina continues to operate at historically high production levels and alone accounted for approximately 30% of Brazil's total hog slaughter during the period.

Combined, the three states slaughtered approximately 21.47 million hogs from January through July, representing about 70% of Brazil's total.

The simultaneous expansion of Brazil's main production hubs helps explain the abundant pork supply seen throughout 2026. Although international demand remains strong, production has expanded faster than the market's ability to absorb it, maintaining pressure on live hog prices and producer margins.

The Hog Cycle Comes Into Play

A combined reading of slaughter and price data reflects a typical hog production cycle.

Strong margins in 2024 and 2025 encouraged investment, sow retention and expansion of production capacity. As a result, more hogs began reaching the market in 2026.

Production growth, however, outpaced the ability of both domestic consumption and exports to absorb additional supply, creating a temporary imbalance between supply and demand.

Hog-to-Corn and Soybean Meal Ratios Deteriorate

Another important indicator of profitability is the exchange ratio between live hog prices and key feed ingredients.

The ratio indicates how much corn or soybean meal a producer can purchase with the proceeds from selling a given quantity of live hogs. The higher the ratio, the greater the producer's purchasing power and, generally, the stronger the operating margin.

For the hog-to-corn ratio, conditions deteriorated throughout 2026. In January, the indicator stood at 7.06, above the level recorded during the same period of 2025 and indicating favorable conditions for producers.

As live hog prices declined, however, the ratio progressively weakened, falling to 4.56 in August. This was significantly below the 7.64 recorded in August 2025 and also below 2024 levels.

In practical terms, hog producers' ability to purchase corn has declined sharply during the year.

The same trend can be seen in the live hog-to-soybean meal ratio. After beginning 2026 at 4.34, the indicator fell to 2.66 in August. In August 2025, the ratio stood at 5.02 - nearly twice the current level.

This movement shows that the decline in prices received by producers was greater than the reduction in feed ingredient costs, resulting in a significant deterioration in the economic competitiveness of hog production.

The exchange ratios show that the industry's problem extends beyond the nominal decline in live hog prices. More concerning is the reduction in producers' ability to purchase their main feed ingredients with revenue generated from hog sales.

In practical terms, each unit of live hog sold now buys less corn and less soybean meal than it did a year ago, pointing to a significant deterioration in profitability.

Strong Pork Exports Are Not Enough to Offset Supply

Despite the solid performance of Brazilian pork exports during the year, a substantial volume of pork continues to flow into the domestic market.

Record production increases domestic availability and reduces the market's ability to support prices. In other words, exports are helping alleviate the pressure, but they have not yet removed enough pork from the domestic market to generate a sustained price recovery.

Looking ahead, market performance will depend primarily on three factors: the ability of production growth to slow, continued strength in exports and the evolution of domestic pork consumption.

Brazil's final four months of the year traditionally bring stronger domestic demand associated with year-end holidays, which could contribute to a gradual improvement in prices.

However, given current production levels and the record slaughter volumes recorded in 2026, a more substantial recovery will require a more effective rebalancing of supply and demand.

2026 Is Shaping Up as a Transition Year for Brazil's Hog Industry

The figures confirm that 2026 represents a transition year for Brazil's hog industry. The sector is adjusting after an exceptionally favorable period and now faces record production, increased pork availability, deteriorating feed purchasing ratios and significant pressure on live hog prices.

Until the market fully absorbs the current supply surplus, conditions are likely to remain challenging for hog producers and processors through the remainder of the year.

Editor's note for U.S. readers: The original Brazilian data are reported in Brazilian reais (R$) and metric units. Where useful, AgroLatam USA has added approximate U.S. dollar and U.S. customary-unit equivalents in parentheses. Currency conversions use an indicative rate of approximately R$5.10 per US$1 as of September 9, 2026; therefore, dollar equivalents are for reference only and are not historical conversions for each reporting period.

By Allan Maia: Market Analyst at Safras & Mercado

AgroLatam Editorial Note: This article was originally written in Portuguese. The AgroLatam editorial team translated and adapted it into English for AgroLatam USA, preserving the original analysis, data and conclusions. U.S. dollar and U.S. customary-unit equivalents were added for the convenience of U.S. readers.