Pork Commentary: Cash Lean Hogs Raise Higher10 May 2016
US - The seasonality of Hog Prices is alive and well. Last week 53-54% lean hogs jumped 4¢ a lb. or over $8.00 per head.
In the last couple weeks lean hogs have gained 8¢ lb. or over $16.00 per head. The big question is how soon will lean hogs reach 80¢, we expect by the first of June.
- Last week U.S.D.A Cash early weans averaged $37.93 and 40 lb. feeder pigs $70.64. With early weans now Oct-Nov market hogs we believe $37.93 is a good cash price and reflects reasonable demand relative to supply. A year ago feeder pigs were $60.00 each, $10 per head lower.
- Last week the US marketed 2,214,000 hogs the week before 2,139,000. About 75,000 more. It is a good sign when hog marketings jump and the hog price leaps $8.00 per head. It truly reflects packers being aggressive to buy hogs. From what we can see on daily hog weights the increased hog numbers also have led to average hog weights being pulled down from a week ago.
- We apologize. Last week we reported the rumour that a major Nebraska swine genetic company had gotten prrs in there state of the art filtered boar testing facility. All boars about 2300 went to slaughter. A truly giant crater in any genetic companies program. We also stated that building nucleus barns in the middle of hog country is dangerous. Since then we also learned a Nebraska boar A-I centre went down with prrs last week. We apologise because we stated the boar test facility was filtered. Since we wrote we have been told that filters had not been installed when the prrs hit. We are told that filters will be installed now, wonder about the wisdom of building for genetics in area that needs filters and then not filtering. Reminds us of the cliché “Closing the barn door after the horse got out” Another is “Thank God for the competition”.
- The U.S corn crop is getting planted in a timely matter, there has been rain. Last week July corn declined 14¢. At this point nothing is indicating a problem with the U.S planting. The world price is driver by the U.S crop.
- China has released this year about 150,000 tonnes of frozen pork from there government storages. Equivalent to about 3 million carcasses. Despite this pork entering the market. China’s cash hog price is 20.03 rmb/kg liveweight or an outstanding $1.39 U.S liveweight a lb. ($370 a market hog U.S). The European Union exported double the amount of Pork this March compared to a year ago to China. Europe’s hog prices have also started to increase in the last couple of weeks as hog production declines seasonally.
- Finally – Wall Street Journal this week wrote about Chicken losing its taste and the quest to find a solution. With Pork we have same challenge, taste and flavour are major factors. At Genesus we have been perfecting our Purebred registered Duroc with extensive meat quality work for 18 years. Today Genesus has no peers in taste and flavour combined with industry leading production capacity. We believed the market would re-focus on eating qualities, we committed capital and science to get it done. In Swine Genetics lead or go broke. There is no safety net.
|Author: Jim Long, President & CEO, Genesus Genetics|
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