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Weekly Review: Decline in China and HK Purchases

by 5m Editor
22 November 2008, at 8:17am

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

Pork exports for September 2008 were up 41 percent from a year earlier. As was expected, China plus Hong Kong purchases from the U.S. declined by 17 percent from September of 2007.

Pork trade in September shows a net pork export of 15.8 percent of production, up from 11.4 percent a year earlier.

Pork exports for January-September were up 65.8 percent from 12 months earlier. Net pork exports for January-September at 17.4 percent of production were up from 13.2 percent a year earlier. Pork exports for the first nine months of 2008 amounted to 21 percent of production or a little over one in every five hogs slaughtered in the U.S.

Our sales of pork to Japan for January-September were up 24.6 percent, to Mexico up 43.8 percent, to Canada up 21.0 percent, to South Korea up 29.1 percent, to Russia up 143.5 percent, to China and Hong Kong up 262.2 percent, to Taiwan up 51.7, to Australia up 23.1 percent, and to other countries up 112.6 percent.

The value of pork exports per hog slaughtered for January-July amounted to $36.11 in 2008 compared to $24.54 in 2007. The value of pork and pork variety meat exports for the first nine months of 2008 was $42.17, up from $28.07 in 2007 per hog slaughtered.

Feeder pig imports in September from Canada at 558,219 head were up 4.6 percent from a year earlier. However, slaughter hog imports for September at 185,521 head were down 30.6 percent from 12 months earlier. This is one of the reasons why slaughter in recent weeks has been down from a year earlier.

Total live hog imports from Canada for January-September at 7,265,169 head were up 1.8 percent from 12 months earlier. It is still too early to determine what the impact of COOL will have on live hog imports from Canada. Some of the U.S. packers say they do not plan to slaughter hogs from Canada.

Cash feeder-pig prices this week at United Tel-o-auction were up $4-12 per cwt from two weeks earlier. The lower feed prices are having a positive impact on feeder pig prices.

Our gilt and sow slaughter data continues to suggest producers have at least slowed, if not stopped, the decline in the breeding herd.

Live barrow and gilt weights last week in Iowa-Minnesota at 267.6 pounds per head were up 0.6 pound from a week earlier but down 0.6 pounds from a year earlier. Barrow and gilt carcass weights under Federal Inspection at 199 pounds for the week ending November 1 were down one pound from a year earlier.

Weights continue to support the belief that marketings are not as current as in late August and early September. At that time, carcass weights were 2-3 pounds below 12 months earlier and live weights in Iowa-Minnesota were up to five pounds below the same week in 2007.

Retail pork prices in October at $3.028 per pound set a new record high for the third month in a row. The October 2008 value was up 3.4 percent from a year earlier.

The average retail price of pork for January–October at $2.924 per pound was up 1.8 percent from the same months in 2007. We still do not have all of the additional costs for producing pork built into the retail price because of the higher costs of grain.

Pork product cutout at $56.67 per cwt of carcass Thursday afternoon was down $0.29 per cwt from a week earlier.

Live hog prices Friday morning were $1.00 per cwt lower to $1.50 per cwt higher compared to seven days earlier. Weighted average negotiated prices Friday morning were $1.42 per cwt lower to $1.04 per cwt higher compared to last week.

The live prices Friday morning for select markets were: Peoria $32.50 per cwt, Zumbrota, Minnesota, $36.00 per cwt and interior Missouri $37.25 per cwt.

The weighted average negotiated carcass prices Friday morning were: western Cornbelt $50.91 per cwt, eastern Cornbelt $36.00, Iowa-Minnesota $50.98 per cwt and nation $49.61 per cwt.

Slaughter this week under Federal Inspection was estimated at 2366-thousand head, up 17 percent from 12 months earlier.

There will be no report next week due to the Thanksgiving holiday.