Weekly Review: Rise and Decline of Pork Exports

US - Weekly review of the US hog industry, written by Glenn Grimes and Ron Plain.
calendar icon 20 September 2008
clock icon 4 minute read

Pork exports in July were down 12.2 percent from June but up 84.7 percent from July of 2007. Pork exports for January-July were up 70.8 percent from a year earlier.

Pork exports in January-July to Japan were up 21.8 percent, up 37 percent to Mexico, up 25.7 percent to Canada, up 23.2 percent to South Korea, up 144.2 percent to Russia, up 376 percent to China-Hong Kong, up 20.5 percent to Taiwan, up 25.1 percent to Australia and up 119.7 percent to other countries compared to last year.

Pork imports for January-July were sown 15 percent from a year earlier. Net exports of pork as a percent of production for January-July at 17.9 percent was up 8.7 percentage points from 9.2 percent a year earlier.

These net exports explain most of the difference in live hog demands for January-July, which was up 8.9 percent while pork demand was down 3.9 percent at the consumer level.

The value of pork exports per hog slaughtered for January-July at $35.89 per head was up 45.8 percent from last year. The value of pork variety meats per hog slaughtered for January-July at $11.13 was up 39.3 percent from 12 months earlier. Total pork and pork variety meat exports for January-July was $47.02 per hog slaughtered, up from $32.61 a year earlier.

USDA September 1 Crop report showed this year's corn yield at 152.3 bushels per acre, down from an estimate of 155 bushels per acre in August. The USDA estimated corn price for the 2008-09 market year $5-6 per bushel. The 2007-08 market year corn price was $4.20 per bushel. This will increase the cost of producing hogs by $4-9 per cwt in the coming year compared to 12 months earlier.

Retail pork price in August were up 1.9 percent from July and up 2.9 percent from August of 2007. For January-August retail pork price were up 1.3 percent from a year earlier. Only the marketers benefited from the higher retail prices. The processor-retailer margin was up 1.8 percent and the packers' margin was up 8.6 percent from 12 months earlier. The producer’s average price for January-August was down 1.2 percent from 2007.

The average live weight of barrows and gilts for last week was up 2.5 pounds from a week earlier at 261.9 pounds. However, this weight is still 4.3 pounds per head below a year earlier. Some people believe a portion of this reduced weight is due to some producers feeding distillers dried grain which reduces the rate of gain. However, we still believe a portion of the reduction in weight is due to high feed prices.

Pork cutout stabilized this week and gained a little with the cutout Thursday afternoon at $76.95 per cwt was up $1.89 per cwt from a week earlier.

Loin price at $92.94 per cwt were down $0.20 per cwt, Boston butts at $78.08 were down $1.70 per cwt, hams at $77.36 per cwt were up $7.04 per cwt and bellies at $80.94 per cwt were up $5.35 per cwt from seven days earlier.

The live prices for hogs Friday morning were $2.00 to $3.00 per cwt lower compared to a week earlier. The weighted average carcass price Friday morning were $0.34 per cwt higher to $1.61 per cwt lower compared to last week.

The top live prices by market for Friday morning were: Peoria $44.00 per cwt, Zumbrota, Minnesota, $46.00 per cwt and interior Missouri $46.75 per cwt. The weighted average carcass price by area Friday morning were: western Cornbelt $69.59 per cwt, eastern Cornbelt $65.16 per cwt, Iowa-Minnesota $69.72 per cwt and nation $67.10 per cwt.

Slaughter this week under Federal Inspection was estimated at 2335 thousand head, up 4.1 percent from a year earlier.

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