Global pork output forecast seen up in 2010

 

 

USDA's Foreign Agricultural Service (FAS) is forecasting world pork production will be up 1.7% this year thanks to a projected 3.5% increase in China.

 

However, USDA is forecasting 2010 pork production outside China will be down 0.2% compared to last year.

 

There are two major pork producing regions in the world: China and everybody else, according to analysts. China is expected to account for 49.4% of 2010 world pork production.

 

The FAS expects the amount of pork moving in international trade will be up 2-4% this year. They are forecasting increased pork imports by each of our top three foreign customers - Japan, Mexico and Canada.

 

The US is the world's largest pork exporter. The FAS expects US pork exports to be up 5.7% this year. They are forecasting pork export increases of less than 1% for both the EU and Canada, the world's second and third largest pork exporters. The number four exported, Brazil, is expected to increase its pork exports by 12%.

 

The financial crisis in Europe has caused the dollar to strengthen rapidly in recent days making exporting US pork more of a challenge.

 

USDA's Thursday afternoon calculated pork cutout value was US$85.37/cwt, down US$2.58 from the previous Thursday and at the lowest level since April 16. Pork cutout has dropped US$6.44 since its peak on May 14. A dip in cutout at this time of year is not unusual. The quick spring run up in pork prices often slows retail pork movement in early summer.

 

Last week's hog slaughter totalled 1.791 million heads, down 6.9% from the week before, and down 14.4% compared to the same week last year. The big drop in slaughter was due to Monday's Memorial Day holiday.

 

The average carcass weight of barrows and gilts slaughtered the week ending 22 May was 201 pounds, the same as the week before and up 1 pound compared to a year ago. Iowa-Minnesota live weights last week averaged 270.8 pounds, up 0.7 pounds compared to a year earlier.

 

The June lean hog futures contract ended the week at US$79.05/cwt, down US$2.80 from the previous Friday. The July contract settled at US$79.72, down US$2.88 for the week. August closed the week US$2.03 lower at US$80.77/cwt and October ended the week at US$74.07/cwt.