Hog prices in the US direct markets gained nearly 9 percent on average this week and pushed the Chicago Mercantile Exchange's latest two-day lean hog index to the highest level in 11 years.

Analysts and economists said the strength in hog prices is defying the historical standards since year-to-date slaughter is averaging 9.1 percent above a year ago and even recent weeks' totals have been running from 6 percent to 9 percent above last year.

The rising trend in wholesale pork prices continued throughout the week as well. After the pork carcass composite value, commonly known as the pork cutout, on July 31 took out the previous high, new tops were set each day this week. The US Department of Agriculture reported the cutout Friday at $92.32, which was up $3.42 for the week. Friday's record-high cutout was up $20.95, or 29%, from the year-ago figure of $71.37.

Market analysts and livestock dealers said the continued strength in hog prices is coming largely from excellent international demand. They said among several factors contributing to the record-large export sales, key ones include the weak US dollar compared with other currencies, growth in the world economy and reduced pork production in Europe and Canada.

The weak dollar makes US pork more affordable for the international buyers. Comparing the exchange rates of the dollar to the Japanese yen, Mexican peso and Russian ruble now versus a year ago showed that buyers in these countries currently have from 8.5 percent to 10 percent more buying power than at this time a year ago.

Analysts said with the difference in the value of the currencies, while wholesale pork prices are setting new highs domestically, international buyers are not feeling as much upward price pressure.

There has also been speculation among some analysts and meat brokers that certain pork-importing nations may be beginning to stockpile product as a hedge against expected higher prices and tighter supplies in 2009. They said with other key pork-producing countries having cut back on output due to high feed and energy costs, competition for US pork has increased.

In the beef complex, choice and select carcass values also rallied this week. Choice beef values closed Friday at $162.22, up $3.90 for the week while select finished the week at $155.77, $4.48 above the Aug. 1 figure.

    
This week's cattle slaughter was estimated at 668,000 head, compared with 665,000 a week ago and 672,000 a year ago. Year-to-date cattle slaughter is up 1.0 percent from a year ago.

The week's hog slaughter was estimated at 2.128 million head, compared with 2.091 million last week and 2.005 million a year ago. Year-to-date hog slaughter is up 9.1 percent.

  
The USDA estimated total beef, pork and lamb production for the week at 941.0 million pounds. Last week's output was 933.0 million pounds, and the year-ago figure was 928.0 million pounds. Year-to-date combined meat output is up 4.9 percent.

Broiler/fryer slaughter this week was estimated at 167.288 million head, compared with 166.665 million a week ago and 165.427 million a year ago.