Commentary: 1 March 2010 USDA Hogs and Pigs Report

US - Dr Mike Brumm, Extension Swine Specialist, University of Nebraska comments on the latest USDA Hogs and Pigs report.
calendar icon 30 March 2010
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This report caught many market commentators and observers by surprise. The decline in the breeding herd inventory was larger than trade estimates, especially since many cull sow buyers had indicated a slow down in cull sow sales beginning in late February when the value of cull sows rose above $50/cwt.

The 1 March US breeding inventory was the lowest 1 March inventory on record. On the other hand, the kept for market inventory was the 3rd highest on record, with the 1 March record occurring in 2008. Both the import of Canadian feeder pigs and the improved productivity of the US breeding herd are responsible for this variation in rankings between the categories.

Producers in Nebraska weaned 10.0 pigs per litter while South Dakota producers weaned 10.2 pigs/litter for the December thru February recording period. The US average for this period was 9.61 pigs weaned per litter. Of the 16 states with individual data, only Texas producers failed to wean at least 9.0 pigs per litter, with an 8.7 pigs per litter average reported.

In Table 1, in addition to the ranking of all states with over 1 million pigs in inventory on 1 March, I’ve computed the number of pigs in the kept for market category per breeding herd animal. The US average is 10.1. In general, if this value is greater than 11.0, the state is a net importer of pigs while values lower than 9.0 indicate a state that is a net exporter of feeder pigs. The Midwest states of Iowa, Indiana and Minnesota are net importers of feeder pigs while the states of Nebraska, S Dakota, Missouri and Illinois are exporters of feeder pigs.

Another interesting item in this report is the documented decline in the breeding herd inventory in North Carolina. The reported 1 March inventory of 880,000 head is the smallest quarterly breeding herd inventory in that state since 1 September 1995. Between 1995 and 2010, the breeding herd in North Carolina was very stable, ranging from 1.0 to 1.02 million head on each quarterly report.

The decline in North Carolina’s inventory, along with the decline in the Texas breeding herd inventory match with the public statements of Smithfield Foods regarding their decision to sell 10 per cent of their breeding herd inventory over the past year. In Texas, this represented the closing of the Premium Standard production module while in North Carolina it represented the closure of some sow units and intensified culling in others.

One of the items that can’t be discerned from the Hogs and Pigs report is the parity structure of the US breeding herd. There are many reports of producers and production systems delaying purchases of replacement gilts this past year. Since early February sellers of replacement gilts have reported very strong sales. If the US breeding herd was aging, some of the improvements in productivity may have been due to this abnormal increase in age. With a flush of gilts possibly entering many production flows, it is possible that the productivity increase which we have become accustomed to will stall for several months as these young females enter the US breeding herd.

Further Reading

- You can view the full report by clicking here.
- You can view the USDA Quarterly Hogs and Pigs Report - March 2010 by clicking here.
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