Hog Outlook: Good News for Hog Producers!

US Weekly Hog Outlook, 18th August 2007 - Weekly review of the US hog industry, written by Glenn Grimes and Ron Plain.
calendar icon 18 August 2007
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Artificial insemination grew very rapidly in late twentieth century but has leveled off in recent years. It is practiced by the majority of producers producing more than 3,000 hogs annually.

Percent of Litters Sired by Artificial Insemination, 2006
Firm size
(thousand-head marketed annually)
1997 2000 2003 2006
1-3 10% 23% 23% 22%
3-5 21 33 66 69
5-10 39 40 79 79
10-50 58 65 91 88
50-500 75 95 98 100
500+ 84 91 100 100

Hog producers received good news last Friday with the August report of crop production. U.S. corn yield per acre was estimated at 152.8 bushels. Missouri estimated yield was 137 bushels per acre.

This would produce a U.S. corn crop of 13.1 billion bushels. USDA estimates the carryover of corn from the 2007-2008 marketing year would be 1.516 billion bushels — up from the 1.137 billion bushels estimated for the 2006-2007 ending stock.

USDA estimates the 2007-2008 farm price for corn at $2.80-3.40 per bushel. The midpoint estimate for corn for 2007-2008 at $3.10 per bushel would be up $0.10 from the estimated $3.00 per bushel for the 2006-2007 marketing year.

The 2007 August 1 U.S. soybean crop was estimated at 2.63 billion bushels — down 18 percent from the 2006 crop. The U.S. estimated soybean yield for 2007 is 41.5 bushels per acre and the Missouri yield is estimated at 37 bushels per acre. Remember, August weather has a big impact on soybean yields. Therefore, substantial change could occur in soybean production from the August 1 estimate.

The USDA August 1 estimate is for the 2007-2008 soybean ending stock to decline to 220 million bushels from the estimated 575 million bushels for 2006-2007 marketing year-end.

Soybean price in the 2006-2007 marketing year is estimated at $6.40 per bushel. The estimated 2007-2008 soybean price per bushel is estimated at $7.25-8.25 per bushel or a midpoint estimate of $7.75 per bushel — up 21 percent from the past year.

The good news for hog producers is the estimated price for soybean meal for the 2007-2008 marketing year is $200-230 per ton — up about $5.00 per ton at the midpoint estimate of $215 per ton this coming year from the past year.

The hot weather of last week slowed rates of gain in Iowa-Minnesota. The estimated live weight for barrows and gilts for week ending Aug 11 was down 1.8 pounds from a week earlier at 260.5 pounds, but still 0.6 pound above a year earlier. With the heat experienced this week, we expect weights of barrows and gilts in Iowa-Minnesota for the week ending August 18 to be below the 260.9 pounds of a year earlier.

The top prices for barrows and gilts live this Friday morning were $0.50-5.50 per cwt lower compared to a week earlier. The weighted average negotiated carcass prices Friday morning were $2.05-7.05 lower compared to 7 days earlier.

The top live prices Friday morning for select markets were: Peoria $45 per cwt, St. Paul $47.50 per cwt and interior Missouri $47.50 per cwt. The weighted average negotiated price by area Friday morning was: western Cornbelt $66.73 per cwt, eastern Cornbelt $64.72 per cwt, Iowa-Minnesota $66.65 per cwt and nation $66.51 per cwt.

The cutout per cwt of carcass Thursday afternoon at $73.17 per cwt was up $2.57 per cwt from a week earlier.

Slaughter this week under Federal Inspection was estimated at 1,989 thousand head, up 1.5 percent from a week earlier.

Retail pork prices in July set another record high at $2.936 per pound, up 0.9 percent from June.

Pork exports during June were down 8.4 percent from last year. For the first 6 months of 2007, pork exports are down 3.5 percent from 12 months earlier.

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