April 8, 2011
 

US hog inventory increases but prices to rise

The US inventory for all hogs and pigs has rose 1% from year ago levels as of March 1, to 64 million head, due to the assistance of a 1% rise in the December 2010 to February 2011 pig crop.

Given higher pork prices, US pork producers were enticed to increase their pig breeding herd slightly to 5.79 million head. Despite this, US analysts' estimated hog profits for 2011 show it is not enough to encourage wide-spread expansion, given rising input costs particularly for feed. The intended sows farrowing for the March to May quarter is expected to drop 3% on year and 5% on 2009 levels, to 2.85 million head.

Over the first two months of 2011, US pork production has increased 3% on year ago levels, despite hog slaughter remaining relatively unchanged. US producers have been increasing hog carcase weights as higher livestock and meat prices seem to have offset rising feed costs.

Given the increase in carcase weights, US pork production for this year is predicted to rise 1% on 2010, to 10.2 million tonnes cwt, according to the latest USDA World Agricultural Supply and Demand Estimates.

Despite this production increase, US livestock hog prices for this year are forecast to average 10% above 2010, amid an expected 11% increase in US pork exports and significantly higher beef and poultry prices. Wholesale pork prices for the first quarter of this year have already jumped approximately 23% on year ago levels.