Hog Price Review and Weekly Summary

US Weekly Hog Outlook, 27th December 2002 - Weekly review of the US hog industry, written by Glen Grimes and Ron Plain.
calendar icon 28 December 2002
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Ron Plain
Ron Plain

The demand for pork at the consumer level for January-November was up, but by less than 1% from twelve months earlier. However, this is probably a very good performance with the larger supplies of both beef and broilers. However, due to lower retail prices and wider marketing margins the demand for live hogs was down over 5% at our midpoint estimate.

Processor-retailer margins were up 10% for these eleven months from a year earlier and packer margins were up nearly 7% according to the USDA data. However, reports from two packers indicate their margins in 2002 are not as good as in 2001.

Retail pork prices for January-November were down 1.1% from the same period in 2001. November retail prices for pork were down by a little less than 1% from a year earlier.

Prices for 51%-52% lean live hogs for January-November were down almost 25% from twelve months earlier. Based on the USDA data, live hog prices for January-November would have been within $1 per cwt of a year earlier with the same marketing margins as in 2001 for the industry.

Pork prices this Friday morning were mixed from a week earlier. Pork loins with ¼ inch trim at $98 per cwt were steady with a week earlier. Boston butts at $52 per cwt were down $0.88 per cwt. Hams weighting 17-20 pounds at $42.50 per cwt were down $2.50 per cwt and 12-14 pound bellies at $82 per cwt were up $6.00 per cwt from a week earlier.

The December Hogs and Pigs Report will be released on Monday, December 30th. We believe the breeding herd was down 4% and the market herd was down 2% and total herd down 2% from twelve months earlier on December 1.

Our data continues to show reductions in the breeding herd through December. The gilt percentage of barrow and gilt slaughter during this period was at a level that has resulted in breeding herd reductions in the past.

We hope the farrowings and farrowing intentions show a larger decline than was indicated in the September report.

Hog slaughter this holiday shortened week was estimated at 1580 thousand head under Federal Inspection --- up 3.4% from a year earlier.

Hog prices this Friday morning were $3.50 per cwt higher to $1 lower than a week earlier live. Carcass prices for average of 185-pound carcass with 0.9-1.1 inches back fat, 6 square inch loin 2 inches deep were $0.52 higher to $1.71 lower than a week earlier.

Top live prices for select markets on Friday morning were: Peoria $29, St. Paul $31.50, Sioux Falls $33, and interior Missouri $28. Average carcass prices for carcasses with the above specifications on Friday morning were: Western Cornbelt $40.47, Eastern Cornbelt $39.80, Iowa-Minnesota $40.10, and Nation $40.33.

Happy New Year.

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