Weekly Review: Meat Production Forecast to Drop

US - Weekly review of the US hog industry, written by Glenn Grimes and Ron Plain.
calendar icon 16 May 2009
clock icon 4 minute read

The odds are almost 100 per cent that production of all meats will be down in 2009 compared to 2008. USDA current estimate is for pork production to be down 2.6 per cent, beef 0.1 per cent, chicken 3.8 per cent and turkey down 7.4 per cent. This would mean total meat production in 2009 would be down 2.8 per cent from a year earlier.

USDA estimate of meat production in 2010 compared to 2009 is for a 0.5 per cent decline in pork, a 2 per cent decline in beef, a 1.7 per cent increase in chicken and a 2.1 per cent increase in turkey compared to 2009.

We certainly hope the USDA estimate of pork production is too high for 2010. The probabilities are very low that demand will grow enough to give profitable prices for an average cost producer with only a 0.5 per cent decline in supply in 2010 compared to this year.

Even though current signs show producers basically moving the herd sideways with the potential for little growth or loss in size, with the losses now indicated for 2009 for hog producers the odds favor a larger decline in production than 0.5 per cent in 2010 compared to 2009.

The cash hog market started the week very strong with the negotiated carcass price in western Cornbelt up $5.74 the first two days of the week. Pork cutout led the change with the cutout per cwt of carcass Thursday afternoon at $61.85 per cwt up $3.27 per cwt for the week.

Loins at $76.05 per cwt were up $3.94 per cwt, Boston butts at $72.46 per cwt were up $16.47 per cwt, hams at $45.06 per cwt were up $0.26 per cwt and bellies at $77.19 per cwt were down $2.59 per cwt on Thursday compared to seven days earlier.

Pork exports in March were up 2.2 per cent from a year earlier while pork imports were basically the same as a year earlier.

Pork exports for January-March were down 6.6 per cent from 2008 while pork imports were down 6.6 per cent from 2008 while pork imports were down 5.5 per cent from the same months 12 months earlier.

Net pork exports as a percentage of pork production for January-March of 2009 at 14.25 per cent down from 14.74 per cent a year earlier or down 3.3 per cent from 2008.

For January-March, our pork exports to Japan were up 9.7 per cent, to Mexico up 59.6 per cent, to Canada down 2.6 per cent, to South Korea down 9.2 per cent, to Russia down 44.9 per cent, to Australia up 54.9 per cent, to Taiwan up 99 per cent, to China Hong Kong down 62.8 per cent and to other countries up 2.3 per cent compared to 2008.

Live hog imports for January-March from Canada were down 39.6 per cent from last year. Both slaughter and feeder pig imports were down from a year earlier.

Live hog prices Friday morning were up $5.00-7.25 per cwt compared to a week earlier. The weighted average negotiated carcass prices Friday morning were up $5.91 to $10.10 per cwt compared to seven days earlier.

The top live prices for select markets Friday morning were: Peoria $38 per cwt, Zumbrota, Minnesota, $41 per cwt and interior Missouri $45.50 per cwt.

The prices for last week for feeder pigs nationally were steady to $2 per head lower than a week earlier. These prices were 10 pound basis pigs 50-54 per cent lean $35.75 per head. The average price for 50-54 percent lean basis 40 pound pigs were $44.29 per head.

Slaughter this week under Federal Inspection was estimated at 2076 thousand head, up 0.7 per cent from the same week in 2008.

The weighted average negotiated carcass price by area Friday morning were: western Cornbelt $6.77 per cwt, eastern Cornbelt $59.94 per cwt, Iowa-Minnesota $63.89 per cwt and nation $61.62 per cwt.

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