US Swine Economics Report: Productivity growth continues
US - USDA's June estimate of the nation's hog inventory came in near the high end of trade expectations.
3 July 2007
3 minute read
At 100.9% of last June's level, the breeding herd was 0.4 points above the average of pre-release trade estimates. The trade forecast the market hog inventory to be up 1.3%. USDA said it was actually up 1.8%. USDA predicted June-August farrowings would be up 1.6% (the trade predicted up 0.6%) and USDA said fall farrowings would be up 0.4% (the average of trade estimates: +0.5%).
As expected, USDA revised upward some of their past inventory estimates. Based on the inventory numbers in the March report, hog slaughter during March-May was expected to be up 1.55%. It actually came in 3.48% above the same months in 2006 (or up 3.35% after adjusting for the increase in imports of Canadian slaughter hogs). So, USDA revised up their March inventory of pigs weighing 120-179 pounds by 2.2%. The also increased the size of the September-November pig crop by 356,000 head and increased fall 2006 farrowings from 100.3% of a year ago (March estimate) to 101.7% (new estimate).
Productivity growth continues. Pigs per litter in the March-May quarter averaged 9.15, the highest ever for any quarter and the 15th consecutive quarter above year-earlier levels.
USDA said the inventory of market hogs weighing over 180 pounds was up 3% on June 1, which might be a bit low since daily hog slaughter in June was up 4%.
USDA said the inventory of market hogs weighing 120-179 pounds was up 1.2% on June 1 and the inventory of market hogs weighing 60-119 pounds was up 1.5%. If these numbers are close to right, third quarter hog slaughter should be up roughly 1.5% if imports of slaughter hogs from Canada continue to run above year-ago levels. If so, expect July-September live hog prices to average a bit under $50/cwt.
USDA said the inventory of market hogs weighing less than 60 pounds was up 1.8% on June 1, implying fourth quarter hog slaughter will be up roughly 2%. I expect fourth quarter hog prices should average in the mid $40s.
Increased availability of circo-virus vaccine may drive down death loss and result in higher slaughter, and lower prices, than implied by the market hog inventory.
As expected, USDA revised upward some of their past inventory estimates. Based on the inventory numbers in the March report, hog slaughter during March-May was expected to be up 1.55%. It actually came in 3.48% above the same months in 2006 (or up 3.35% after adjusting for the increase in imports of Canadian slaughter hogs). So, USDA revised up their March inventory of pigs weighing 120-179 pounds by 2.2%. The also increased the size of the September-November pig crop by 356,000 head and increased fall 2006 farrowings from 100.3% of a year ago (March estimate) to 101.7% (new estimate).
Productivity growth continues. Pigs per litter in the March-May quarter averaged 9.15, the highest ever for any quarter and the 15th consecutive quarter above year-earlier levels.
USDA said the inventory of market hogs weighing over 180 pounds was up 3% on June 1, which might be a bit low since daily hog slaughter in June was up 4%.
USDA said the inventory of market hogs weighing 120-179 pounds was up 1.2% on June 1 and the inventory of market hogs weighing 60-119 pounds was up 1.5%. If these numbers are close to right, third quarter hog slaughter should be up roughly 1.5% if imports of slaughter hogs from Canada continue to run above year-ago levels. If so, expect July-September live hog prices to average a bit under $50/cwt.
USDA said the inventory of market hogs weighing less than 60 pounds was up 1.8% on June 1, implying fourth quarter hog slaughter will be up roughly 2%. I expect fourth quarter hog prices should average in the mid $40s.
Increased availability of circo-virus vaccine may drive down death loss and result in higher slaughter, and lower prices, than implied by the market hog inventory.
