June 1, 2009

 

US hog prices post mild recovery, but average below the previous week

US cash hog prices posted a mild recovery this week of about US$1.92 per hundredweight, but the average came in below last week's mean value.

 

Last week, the US Department of Agriculture's national weighted average prices fell about US$6 per hundredweight, or nearly 10 percent. This week, the national quote moved up 3.4 percent from last Friday, but the four-day average was US$56.48, down US$1.57 from a week ago.

 

Hog prices during the last week of May have declined from the previous week in each of the past 10 years. It happened again this year despite prices being about 23 percent below a year ago.

 

The upturn since mid-week, however, raised hopes among producers of possible further advances next week that would trim their losses.

 

Wholesale pork prices continue to be a concern for producers and some traders and analysts. The USDA reported the pork cutout Friday at US$58.89, which put the change for the week at down US$1.35. Pork prices have fallen for four consecutive days and the decline was the eighth in the last 10 days.

 

"Pork product prices cannot get any traction to move higher," agricultural economists Glenn Grimes and Ron Plain said in their latest hog outlook report released Friday. "Even though demand for pork at the consumer level was up over 1 percent for January-April, here in May it appears to be weaker than a year earlier. How much summer rally we will eventually get is uncertain at the present time, and we cannot rule out that the flu episode will ruin any seasonal increase," they said.

  

Last week's cattle slaughter was estimated at 617,000 head, down from 678,000 a week ago and 623,000 a year ago. Year-to-date cattle slaughter is down 5.6 percent from a year earlier.

 

Last week's hog slaughter estimate was 1.804 million head, down from 2.057 million a week ago and 1.825 million a year earlier. For the year, hog slaughter is off 4.7 percent.

   

The USDA estimated total beef, pork and lamb production for the week at 844.8 million pounds. Last week's output was 944.0 million pounds, and the year-ago figure was 846.4 million pounds. Year-to-date output is down 4.2 percent.

 

Broiler/fryer slaughter for the week was estimated at 144.134 million head, compared with 161.125 million a week ago and 152.590 million a year ago.