USDA November crop report showed the 2007 corn crop down 150 million bushels from the October estimate. The ending stocks at the conclusion of the 2007-08 market year were reduced 100 million bushels. This smaller crop and reduced carryover stocks indicate higher prices, and USDA increased their estimate of U.S. farm price of corn from $3.20 per bushel in October to $3.50 per bushel in November for the midpoint estimate.

The soybean crop for 2007 in the November estimate was four million bushels less than in October. Carryover stocks were reduced by five million bushels. Soybean prices per bushel were increased by $0.65 in the November midpoint estimate from the October estimate at $9.00 per bushel in November. Soybean meal prices in November were increased by $15 per ton to $250 per ton as a midpoint estimate.

Production cost per cwt of live hog is now around $50 per cwt and likely to average at least about $50 per cwt in 2008. It now looks like 2008 will be the first year of major losses for hog producers since 2003.

Very current
Based on live weights of barrows and gilts in Iowa-Minnesota, markets are very current. The average weight for these two states for the week ending October 10 at 268.9 pounds was down 0.8 pound from a week earlier and down 0.9 pound from a year earlier. This is sample data, therefore a portion of the difference from last year to this year may be, and probably is, sample error.

Pork exports for September 2007 were up 9.3 percent from last year, and with the larger exports of recent months, pork exports from January-September are now only down 0.2 percent from a year earlier.

For the first nine months of 2007, pork exports to Japan were up 8.3 percent, to Canada up 6.4 percent, to Mexico down 29.7 percent, to Russia down 6 percent, to South Korea down 7.5 percent, to Hong Kong and Mainland China up 91.4 percent, to Taiwan down 40.2 percent, to the Caribbean down 25.2 percent, and to other countries up 4.2 percent. The odds now appear very high for 2007 to be the sixteenth consecutive year for pork exports to be at a record high.

Decline
Net pork exports as a percent of production for January-September declined from 9.39 percent in 2006 to 9.14 percent in 2007. If the trend of recent months continues through December 2007, net pork exports will be close to a year earlier. Pork cutout for the week through Thursday at $58.47 per cwt of carcass was down $0.34 per cwt from a week earlier. Loins at $69.82 per cwt were down $1.21 per cwt, Boston butts at $54.98 per cwt were up $0.32 per cwt, hams at $54.98 per cwt were down $2.72 per cwt, and bellies at $76.68 per cwt were up $5.24 per cwt from seven days earlier.

Live hog prices Friday morning were $0.75-2.50 lower compared to a week earlier. Average weighted carcass negotiated hog prices were $0.86-1.89 lower compared to seven days earlier.

The top live prices Friday morning for select markets were: Peoria $29 per cwt, St. Paul $31 per cwt and interior Missouri $30.50 per cwt. The average carcass prices by geographic area were: western Cornbelt $45.15 per cwt, eastern Cornbelt $43.31 per cwt, Iowa-Minnesota $45.15 per cwt and nation $44.01 per cwt.

Slaughter this week under Federal Inspection was estimated at 2,362 thousand head, up 10.4 percent from a year earlier.

There will be no letter next week because of the Thanksgiving holiday.

Further Reading

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