Introduction

This document aims to pull together, in one place of reference, all the various information generated by the USDA Quarterly report. This document includes:

USDA Quarterly report: September 2005
What it all means
Graph data from the report Hog Inventories by State (external link - select State and navigate to file)

For a PRINTABLE VERSION of the full 24 page report in PDF format, including all the tabular data which is not shown in this article, Click Here

US Quarterly Pigs and Hogs Inventory: September 2005

U.S. inventory of all hogs and pigs on September 1, 2005 was 61.5 million head. This was up slightly from September 1, 2004, and up 1 percent from June 1, 2005.

Breeding inventory, at 5.97 million head, was up less than 1 percent from last year but down less than 1 percent from last quarter. Market hog inventory, at 55.6 million head, was virtually unchanged from last year but up 2 percent from last quarter.

The June - August 2005 U.S. pig crop, at 26.3 million head, was up slightly from 2004 and up 1 percent from 2003. Sows farrowing during this period totaled 2.90 million head, down slightly from last year. The sows farrowed during this quarter represented 49 percent of the breeding herd. The average pigs saved per litter was 9.07 for the June-August 2005 period, compared to 9.01 last year. Pigs saved per litter by size of operation ranged from 7.60 for operations with 1-99 hogs and pigs to 9.10 for operations with more than 5,000 hogs and pigs.

U.S. hog producers intend to have 2.89 million sows farrow during the September-November 2005 quarter, unchanged from the actual farrowings during the same period in 2004, but up 1 percent from 2003. Intended farrowings for December 2005-February 2006, at 2.88 million sows, are up 1 percent from both 2005 and 2004. The total number of hogs under contract, owned by operations with over 5,000 head, but raised by contractees, accounted for 39 percent of the total U.S. hog inventory, unchanged from last year.

Revisions

All inventory and pig crop estimates for June 2004 through March 2005 were reviewed using final pig crop, official slaughter, death loss, and updated import and export data. Based on the findings of this review, an adjustment of less than one-half of one percent was made to the December 1, 2004 total inventory. The September-November 2004 pig crop was adjusted by one percent.

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What it all means?

What the commentators and industry thinkers read into this data:

Professor Mike Brumm, University of Nebraska September 2005 USDA Hogs and Pigs Report Commentary As other commentators have already noted, this Hogs and Pigs report reflects the lack of expansion in the US industry. However, even though limited expansion in the breeding herd was noted, the restructuring of the industry continues. While Nebraska continues to gradually decline in pig numbers, especially in the kept for market numbers, both Missouri and Indiana have state government initiatives underway in support of maintaining and even growing the swine industry in their states. If it takes 5.5 to 6 months to grow a pig from birth to slaughter, the inventory in the kept for market category approximates the numbers of pigs available for slaughter, less death loss and plus imports, in the next 6 months. One way to look at the inventory and pig crop numbers is to express the previous 3 month pig crop as a percentage of the kept for market inventory. In Table 1 is a historic look at this number since 1998. Continue reading this report here

Chris Hurt, Purdue University Chris Hurt Pork producers must like making money, because they sure are not willing to rock the boat by expanding. The USDA' s September Hogs and Pigs report says that pork producers are content keeping numbers about where they have been. In fact, the breeding herd has changed less than one percent in each of the last five quarterly reports, the longest period ever with such small changes. However, the trend may be broken as producers are finally hinting at some expansion in the distant future. The size of the nation's breeding herd and market herd remain unchanged from the level of a year ago. Slaughter numbers are expected to be up only one percent in October and November and nearly unchanged in December, January, and February. Continue reading this report here

Ron Plain and Glenn Grimes Hogs and Pigs Report - September 2005 USDA's latest Quarterly Hogs and Pigs report came in very close to trade expectations. The breeding herd on September 1 was up 0.2% and both the total inventory and the market hog inventory were unchanged from 12 months earlier. All of the key numbers were within 1% of our forecast. Revisions: USDA reduced their estimate of the number of sows farrowed during December-February by 16,000 litters. This led to a 200,000 head reduction in the size of the March 1 market hog inventory and a 180,000 head reduction in the size of the June market hog inventory. These changes were made to bring past market hog inventories in line with third quarter hog slaughter. Continue reading this report here

Dr. Steve Meyer, Paragon Economics Breeding Herd Holds Steady USDA's quarterly Hogs and Pigs Report for September, released Friday afternoon, Sept. 30, was very close to pre-report expectations. This is the second quarter in a row in which no major differences have occurred. The key numbers from the report are shown in Table 1. The most important message of these numbers is that there has still been virtually no growth in the U.S. breeding herd. The herd is up a mere 0.2% from last September even after 20 months of profits with some of those monthly profits being near-record highs. USDA pegged the market herd as being even with last year. Continue reading this report here

Professor John Lawrence, Iowa State University September 2005 Hogs and Pigs Summary The USDA released its estimated inventory of hogs and pigs as of March 1, 2005. Strong pork demand, that produced the highest annual hog prices since 1996 in spite of record US pork production, has weakened somewhat. Lower grain prices have reduced feed cost and have helped to maintain profitable conditions. As a result most analysts expected an expansion of the US breeding herd. However, the USDA estimated that total hog inventories on September 1, 2005 were nearly identical to the same month a year earlier. The total inventory and market hog inventory were in line with pre-report estimates, but the breeding herd inventory was smaller than expected by the trade and should be bullish of prices next summer. Continue reading this report here

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Graph Data from the Report

Reliability of September 1 Hogs and Pigs Estimates

Survey Procedures: A random sample of roughly 10,600 U.S. producers was surveyed to provide data for these estimates. Survey procedures ensured that all hog and pig producers, regardless of size, had a chance to be included in the survey. Large producers were sampled more heavily than small operations. During the first half of September data were collected from about 8,700 operations, 82 percent of the total sample. The data collected was received by mail, telephone, and face-to-face personal interviews. Regardless of when operations responded, they were asked to report inventories as of September 1.

Estimation Procedures: These hogs and pigs estimates were prepared by the Agricultural Statistics Board after reviewing recommendations and analysis submitted by each field office. National and State survey data were reviewed for reasonableness with each other and with estimates from past years using a balance sheet. The balance sheet begins with the previous inventory estimate, adds the estimates of births and imports, and subtracts the estimates of slaughter, exports, and deaths. This indicated ending inventory level is compared to the Agricultural Statistics Board estimate for reasonableness.

Revision Policy: Revisions to previous estimates are made to improve quarter to quarter relationships. Estimates for the previous four quarters are subject to revision when current estimates are made. In December, estimates for all quarters of the current and previous year are reviewed. The reviews are primarily based on hog check-off receipts and slaughter. Estimates will also be reviewed after data from the Department of Agriculture five-year census of agriculture are available. No revisions will be made after that date.

Reliability: Since all operations raising hogs are not included in the sample, survey estimates are subject to sampling variability. Survey results are also subject to non-sampling errors such as omissions, duplication, and mistakes in reporting, recording, and processing the data. The affects of these errors cannot be measured directly. They are minimized through rigid quality controls in the data collection process and through a careful review of all reported data for consistency and reasonableness. To assist users in evaluating the reliability of the estimates in this report, the "Root Mean Square Error" is shown for selected items in the following table. The "Root Mean Square Error" is a statistical measure based on past performance and is computed using the difference between first and final estimates. The "Root Mean Square Error" for hog inventory estimates over the past 20 quarters is 1.2 percent. This means that chances are 9 out of 10 that the final estimate will not be above or below the current estimate of 61.5 million head by more than 1.2 percent. Chances are 9 out of 10 that the difference will not exceed 2.1 percent.

Source: Quarterly Hogs and Pigs Report, September 2005 - USDA National Agricultural Statistics Service