CME: Slow Growth in Swine Herd

US - Dow Jones Newswire’s quarterly survey of analysts’ expectations for the quarterly Hogs and Pigs report (results in the table at right) indicate that slow growth is still the trend for the US swine herd, writes Steve Meyer and Len Steiner.
calendar icon 22 December 2011
clock icon 3 minute read

Every average estimate is above year-ago levels except that of Sep-Nov farrowings which is 99.9 per cent of last year.

This follows the pattern of September when actual USDA data shows every category slightly higher than last year except Jun-Aug farrowings and Sep-Nov farrowing intentions which were 98.5 per cent and 99.8 per cent of year-earlier levels.

The chart at right, with analysts’ average estimates converted to head and denoted by the red observations for 2011, shows how these estimates fit the historical data. The market herd estimate fits a very normal seasonal pattern and the breeding herd estimate fits the slow growth trend that started in Q1 of 2010.

We think it is interesting that market hog inventories have returned to almost the same trend they were on from 2000 through 2006. That trend was blown to the top side by the introduction of circorvirus vaccines (which allowed a larger percentage of pigs to survive to market weight) in 2007. The market herd then declined sharply along with the breeding herd when costs exploded in 2008 and 2009.

Note that market herd growth is generally back on the same trend but that the breeding herd is growing at a decidedly slower pace, clearly denoting productivity growth. That growth becomes even more impressive when one considers that roughly two million fewer feeder pigs will be imported from Canada this year versus 2007—and one million fewer than 2008. The market herd inventory would be even higher had Canadian imports remained at pre-2009 levels.

Further Reading

- You can view the full report by clicking here.

Charlotte Johnson

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