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US Weekly Hog Supplies Likely to Determine Live Hog Prices This Winter

3 October 2014, at 8:37am

US - A provincial livestock economist with the Saskatchewan Ministry of Agriculture expects the impact of PED on weekly hog supplies to be the main factor influencing live hog prices during the coming months, writes Bruce Cochrane.

Concern over the impact of Porcine Epidemic Diarrhea on the volume of hogs available for slaughter as the weather turns colder have resulted in uncertainty in the market for live hogs.

Brad Marceniuk, a provincial livestock economist with the Saskatchewan Ministry of Agriculture, says the US pig crop was only down by one percent in the third quarter so slaughter numbers are expected to increase during the fourth quarter which will put downward pressure on prices.

Brad Marceniuk-Saskatchewan Ministry of Agriculture:

New Porcine Epidemic Diarrhea cases were reduced significantly during the summer months.

While they were reduced in the summer the cooler weather setting in is expected to create new cases of PED in the United States and Canada.

Two new cases were discovered in sow barns in Manitoba over the last ten days and the amount of new cases we could see this fall is really uncertain at this time and so that's what's bringing some of the uncertainty to the market.

Slaughter weight hog prices have rebounded since early September with Signature 3 index 100 hog prices averaging about $210 per 100 kilograms last week and that's well above long term averages.

While hog prices will be reduced from the current prices in the fourth quarter prices are still expected to be above the long term averages and still profitable during the fourth quarter.

Large feed grain crops in North America over the last two years have really helped to reduce feed costs significantly and have reduced producer production costs over the last year.

But looking forward weekly hog supplies will be a key factor in determining exactly where hog prices go in the coming months.

Marceniuk advises producers to monitor US weekly hog supply numbers and numbers of new PED cases.

He expects hog supplies to go higher and prices to come down but the uncertainty lies with how many new cases of PED there will be moving into November and December and how that affects supply heading into 2015.

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