Weekly Review: Phenomenal Pork Export Demand

by 5m Editor
19 July 2008, at 4:50am

US - Weekly review of the US hog industry, written by Glenn Grimes and Ron Plain.

Pork export demand is phenomenal with a gain of 98.2 percent in May from a year earlier. Pork exports in May of 2008 amounted to $43.62 per head slaughtered. This is up from $25.06 per head slaughtered in May of 2007. Pork by-product exports in May amounted to $6.23 per head slaughtered, which compares with $3.57 per head slaughtered in May a year earlier.

The total value of pork and pork variety meat exports in May amounted to $49.85 per hog slaughtered in 2008, up from $28.62 per head a year earlier.

The value of pork exports for January-May for each hog slaughtered in the U.S. was $33.51 --- up from $24.73 per hog slaughtered in 2007 for January-May. Pork variety meat exports for January-May at $4.80 per hog slaughter were up $1.38 per head from 12 months earlier at $3.42 per head. The total pork and pork variety meat exports for each hog slaughtered in the U.S. from January-May was $38.31 this is a 36 percent increase from the $28.51 per hog slaughtered in the first five months of 2007.

In May, pork exports amounted to 26.5 percent of U.S. slaughter or a little more than one out of every four hogs slaughtered. For January-May, 20.6 percent of U.S. pork production was exported. In carcass weight equivalent, pork exports for January-May were up 61 percent from a year earlier.

For January-May, pork exports to Japan were up 16.2 percent, to Mexico up 19 percent, to Canada up 25 percent, to South Korea up 13.5 percent, to Russia up 145.2 percent, to China and Hong Kong up 401.3 percent, to Taiwan down 5.8 percent, to Australia up 4.4 percent, and to other countries up 107.8 percent from 2007.

Net pork exports as a percent of production for January-May were 16.96 percent. This compared with net pork exports for January-May of 2007 of 9.56 percent of production or a gain of 7.4 percentage points of production.

This is the major reason demand for live hogs in January-May were up 6.8 percent and consumer demand for pork for these five months was down 1.9 percent from 12 months earlier.

The average weight of barrows and gilts in Iowa-Minnesota for the week ending July 12 was up 0.9 pound from a week earlier at 260.5 pounds but down 2.8 pounds from a year earlier. The evidence is strong that hog producers are more current with marketings than a year earlier. Having marketings more current this fall will minimize the potential negative impact of short slaughter capacity relative to supply.

The strong export demand pushed pork cutout higher this week. The cutout Thursday afternoon at $83.07 per cwt of carcass was up $2.21 per cwt from a week earlier.

Loin prices at $99.97 per cwt were up $2.21 per cwt, Boston butts at $85.05 per cwt were down $4.85 per cwt, hams at $85.75 per cwt were up $8.02 per cwt and bellies at $84.53 per cwt were up $1.18 per cwt from seven days earlier.

Top live hog prices this Friday morning were $1.50 to $5.00 per cwt higher compared to last week. The weighted average negotiated carcass prices were $0.24 lower to $5.15 per cwt higher compared to a week earlier.

The top live prices Friday morning for select markets were: Peoria $47.00 per cwt, Zumbrota, Minnesota, $52.00 per cwt, and interior Missouri $51.25 per cwt. The weighted average carcass prices for negotiated hogs by area were: western Cornbelt $76.11 per cwt, eastern Cornbelt $73.65 per cwt, Iowa-Minnesota $76.12 per cwt, and nation $74.46 per cwt.

Slaughter this week under Federal Inspection was estimated at 2145 thousand head, up 9.6 percent from a year earlier.

5m Editor