Hog Outlook: Forecast Lowered for 2016-2017 Red Meat Production

US - USDA has lowered slightly their forecast of red meat and poultry production in both 2016 and 2017, write Ron Plain and Scott Brown, Ag Economics, MU.
calendar icon 13 June 2016
clock icon 4 minute read

US pork exports were down 11.1 per cent in April compared to a year earlier. China purchased a lot more US pork, but shipments to Japan and South Korea were down. For January-April pork exports were up 0.3 per cent.

US pork imports were down 4.8 per cent in April due to a decline in imports from Canada. The European Union sent more pork to the US During January-April, US pork imports were up 3.0 per cent.

Live hog imports were down 6.8 per cent compared to April 2015 with 2 per cent more feeder pigs coming south but 35 per cent fewer slaughter hogs coming south. During the first one-third of 2016, hog imports were up 7.3 per cent.

USDA's weekly Crop Progress report says that 83 per cent of soybean acres were planted by June 5. That compares to 73 per cent a week earlier and 77 per cent on that date last year. The five-year average is 77 per cent planted by June 5.

The national negotiated barrow and gilt carcass price averaged $77.56/cwt on Thursday, up $2.73 from a week earlier and up 14 cents from a year ago.

The national negotiated barrow and gilt price averaged $76.44/cwt on the morning report today, up $3.29 from a week earlier, but down 29 cents from a year ago. The western corn belt averaged $76.57/cwt this morning. There were no regional negotiated price quotes this morning for the eastern corn belt or Iowa-Minnesota.

The top hog price today at Peoria was $48/cwt, up $2 from last Friday. The top price for interior Missouri live hogs was $51.75/cwt, up 75 cents from a week ago.

Friday morning's pork cutout value was $86.63/cwt FOB the slaughter plants. That is up $1.03 from the week before and up $1.61 from a year ago. Belly prices were sharply higher than last Friday but loins were lower. This morning's national negotiated hog price was 88.2 per cent of the cutout value.

This week's hog slaughter was 2.086 million head, up 9.8 per cent from last week which was light because of Memorial Day, but down 1.7 per cent from the same week last year.

The average slaughter weight of barrows and gilts in Iowa-Minnesota last week was 283.1 pounds. That is up 0.9 pound from the week before and up 1.0 pound from the same week last year.

Hog futures had a quite week. The June lean hog futures contract ended the week at $82.275/cwt, down 2.5 cents from the preceding Friday. Today, July hogs settled at $85.70/cwt, down 27.5 cents from last Friday. The August hog contract settled at $86.625, up 75 cents for the week.

Corn futures keep moving higher. The July contract gained 4.75 cents this week to close the week at $4.23 per bushel. December corn futures ended the week at $4.3075/bushel, up 11 cents from last Friday.

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