Lard

Lard is the layer of fat found along the back and underneath the skin of a hog. The hog’s fat is purified by washing it with water, melting it under constant heat, and straining it several times. Lard is an important byproduct of the meatpacking industry. It is valued highly as cooking oil because there is very little smoke when it is heated. However, demand for lard in cooking is declining because of the trend toward healthier eating. Lard is also used for medicinal purposes such as ointments, plasters, liniments, and occasionally as a laxative for children. Lard production is directly proportional to commercial hog production, meaning the largest producers of hogs are the largest producers of lard.

Prices – The average wholesale price of lard in early 2003 fluctuated in the range of 16.7-18.6 cents/pound. That was higher than the average prices seen in the past 4 years but below the recent average yearly high price of 23.39 cents seen in 1997.

Supply – World production of lard was 7.016 million metric tons in the latest reporting year, up 2.3% from the 2001/2 level of 6.858 million tons. China is by far the largest consumer of lard at 3.023 million metric tons, followed by the US (506 million tons), Germany (427 million tons), and the former USSR (343 million tons). US production of lard in 2001/2 was 1,058 million pounds, with about 963 million pounds of that production going to domestic use and about 103.0 million pounds to exports (down from 174 million in 2000/1).

Demand – US consumption of lard was on track to hit about 330 million pounds in 2003, which would be up 9% from the 2002 level of 303.2 million pounds. Still, that is much lower than the levels over 400 million pounds seen prior to 1998.