Hog prices continue to increase

US Weekly Hog Outlook, 16th May 2003 - Weekly review of the US hog industry, written by Glen Grimes and Ron Plain.
calendar icon 17 May 2003
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Ron Plain
Ron Plain

Cash hog prices at terminal markets were $1-$2 higher than last Friday this Friday morning. The top prices at select markets were: Peoria $41.50, St. Paul $44, Sioux Falls $45, and interior Missouri $40.75.

Average carcass prices for 185-pound carcass with 0.9-1.1 inches backfat, 6 square inch loin, 2 inches deep were up $2.94 to $5.56 by areas. These prices by areas were Western Cornbelt $61.85, Eastern Cornbelt $58.03, Iowa-Minnesota $62.15, and Nation $59.45.

Slaughter for the past six weeks has been down 1.7% based on preliminary data. Slaughter for this week under Federal Inspection was estimated at 1811 thousand head --- down 2.6% from a year earlier.

Product prices gained some ground this week. Loins with ¼ inch trim at $109 per cwt Friday morning were up $5.80 per cwt from a week earlier. Boston butts at $83 per cwt were up $9 cwt, 17-20 pound hams at $44 per cwt were the same as a week earlier, and 12-14 pound bellies at $100 per cwt were up $7 per cwt from seven days earlier.

Even with the increase in product prices, packer's margins appear to be slim to none as indicated by a slaughter estimate on Saturday at 6000 head.

Cash prices have probably about reached a ceiling until product prices can be increased.

Pork exports in March were over 17% above a year earlier. For January-March of 2003 pork exports were up 8.2% from twelve months earlier. Pork exports to Japan were up 9.5% but were down over 18% to Canada and down nearly 17% to Mexico for the three-month period.

Increased shipments to South Korea, Hong Kong, and category listed as other, more than offset the reductions to Canada and Mexico.

The bad news is that pork imports for January-March were up 23%. However, live slaughter hog imports from Canada were down over 22%. The hogs were slaughtered in Canada with much of the product ending up in the U.S. Our pork imports from Canada for January-March were up over 21%.

Feeder pig imports from Canada continues to grow with the January-March purchases up over 19% from twelve months earlier at 1,075,991 head.

Canada is filling a void for feeder pigs in the U.S. resulting from the sharp reductions in feeder pig production in fringe areas of the Cornbelt of the U.S.

Cash feeder pig prices this week at United tel-o-auction were basically steady with two weeks earlier. The prices at United by weight groups were: 40-50 pounds $89.50-$93 per cwt, 50-60 pounds $72-$78, 60-70 pounds $72, and 70-80 pounds $68.50.

Feeder pig prices are expected to decline some from spring highs unless slaughter hog prices are higher this summer than now expected, but pig prices are likely to hold much higher than the give away prices of late summer and fall of 2002.

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