Weekly Review: USDA Reports Little Change in Pig Population, Concerns over Corn Stock

1 October 2012, at 11:03pm

ANALYSIS - The latest USDA 'Quarterly Hogs and Pigs' report has revealed only small changes in pig numbers in the US. A new record has been set for the number of pigs weaned per litter of 10.13. According to another report, year-end corn stocks were even lower than expected, leading to further jumps in futures prices.

Just published by the USDA is its 'Quarterly Hogs and Pigs Report'. It records a total of 67.5 million pigs in the US on 1 September, slightly more than a year previously and three per cent fewer than in June.

The breeding herd numbered 5.79 million head, slightly fewer than in September 2011 and one per cent down on the previous quarter. Market hog inventory, at 61.7 million head, was up slightly from last year, and three per cent higher than the last quarter.

The June-August 2012 pig crop, at 29.3 million head, was down slightly from 2011. During the period, 2.89 million sows farrowed, one per cent fewer than 2011. The average pigs 'saved' or weaned per litter was a record high 10.13 for the June-August period.

CME commentators, Steve Meyer and Len Steiner, said that the 'Quarterly Hogs and Pigs Report' contained few surprises and indicates a rapid - and perhaps too rapid - shift from expansion to contraction for the US swine sector. They forecast a larger liquidation to come.

The same source highlighted what it called a 'USDA bombshell' that year-end corn stocks in the US were just 988 million bushels, well down on trade estimates of around one billion bushels. The news pushed up futures prices for both maize and soybean meal.

A review of US hog markets from Genesus focused on margins, which fell further over the past month and remain extremely depressed from a historical perspective. Hog prices have been under pressure following heavy slaughter runs recently with increasing pork production.

Other news in brief: antibiotics use in animal production is to be reduced significantly in Germany; pork production in China is forecast to rise about two per cent to 52.65 million metric tons next year; Brazilian pork exports were up in July and August compared to the same months of last year and in Canada, an agricultural economist is predicting improved profitability within Manitoba's pig industry once the sell-off of breeding sows has been completed.