Retail pork prices in June increased by 2.5% from May

by 5m Editor
24 July 2004, at 12:00am

US Weekly Hog Outlook, 23rd July 2004 - Weekly review of the US hog industry, written by Glen Grimes and Ron Plain.

Ron Plain
Ron Plain

Hog slaughter continued very large this week with a estimated Federal Inspection number at 1.892 thousand head. This week's slaughter was a bit below 1.9 million head. Prior to last week, we had never had a weekly slaughter of 1.9 million head under Federal Inspection in July.

Hog prices held quite well with this big slaughter which was 4.1 percent above a year earlier for the week. Live hog prices were from $1.50 lower to $2.00 higher this Friday than 7 days earlier. Carcass prices were $0.67 lower to $0.65 higher compared to a week earlier.

The live top prices on Friday morning were: Peoria $52.50 per cwt, St. Paul $57, Sioux Falls $N/A and interior Missouri $52.50.

The prices for 185# carcass with 0.9-1.1" back fat, 6 sq inch loin 2" deep by area were: western Cornbelt $77.28 per cwt, eastern Cornbelt $75.53, Iowa-Minnesota $77.73 and nation $76.36.

The first summary of imports and exports for January-May did not include May activity. Therefore, last week's letter mostly applied to the first 4 months of 2004.

For January-May pork exports were up 27.9% and pork imports were down 8.5 percent. We increased pork exports to all major countries that buy from us but South Korea in January-May.

Retail pork prices in June increased by 2.5% from May and June prices in 2004 where 7% higher than a year earlier. Retail pork prices for January-June this year were up 4.4% from 12 months earlier.

The producers were able to capture more of the consumer dollar than the increase in retail prices. Based on the USDA data the processors and retailer margins were 3.4% less than the same months of 2003 and the packers margin was also down 3.4% for this period compared to last year.

51-52% live lean hog prices for January - June were up nearly 27% from the same period in 2003.

Sow slaughter for the 4 week period ending July 10 was up 1.3% from last year after adjusting for herd size. However, gilt slaughter for these 4 weeks was down substantially from last year. The good news is that gilt slaughter for the week ending July 17 was back at a level that in the past has resulted in a small decline in the breeding herd.

The packers margin was squeezed lower this week with the 4 major wholesale cuts lower this Friday noon than a week earlier. Loins with a ¼" trim at $116.00 per cwt at noon Friday were down $8.00 per cwt for the week. Boston butts were down $3.80 per cwt at $89.20 per cwt, 17-20# hams at $77.00 per cwt were down $2.00 per cwt and 14-16# bellies at $115.00 per cwt were down $2.00 per cwt for the week.

Cold storage stocks of pork continue to be supportive to hog prices. Total stocks at the end of June were down 18% from the same date in 2003. Ham stocks were down 40%, belly stocks were down 15%, loin stocks were down 16% and rib stocks were down 30% from last year on June 30th.

Feeder pig prices this week at United Tel-O-Auction were basically steady with 2 weeks earlier. The prices by weight groups at United were: 40-50# $89 per cwt, 50-60# $80-82.50, 60-70# $75-88 and 70-80# $75.

5m Editor