September 10, 2007

 

US pork, hog prices fall to 10 percent below

 

 

Wholesale US pork and cash hog prices fell last week to nearly 10 percent below year-ago prices as of Thursday (September 6), pressured by large hog supplies and declines in some key pork cuts such as hams.

 

The US Department of Agriculture (USDA) reported the pork carcass value Thursday afternoon at US$67.72, the lowest since April 11. The quote for the same day a year ago was US$75.06. USDA's national weighted average hog price Thursday afternoon was US$60.92, versus US$67.34 a year ago.

 

Hog slaughters in July and August hit records. The USDA reported July federally inspected hog slaughter up 6.5 percent from a year ago. Preliminary figures for August taken from weekly data report hog slaughter was up about 3.3 percent from the same period last year.

 

The pork complex is struggling to hold up in the face of the large supplies and may need even stronger demand to keep from backsliding further, brokers and analysts said this week. Reduced export sales to Mexico have affected the fresh ham market especially. USDA's "primal cutout value" or base price for hams during August averaged 61.70 cents per pound, down nearly 16 percent from 73.08 cents during the same period a year ago.

 

Some livestock analysts and dealers predict cash hog prices will turn firm by next week since the plants will be back into a full work week.

 

Bob Brown, private analyst in Edmond, Oklahoma said cash hog prices during the second week of September have moved up from the previous week in eight of the last 10 years.

 

However, some traders and livestock market managers remain cautious and say the normal tendency for the market to strengthen next week may not come about if huge numbers of hogs continue to be available to the plants.

 

Choice-grade beef prices, meanwhile, are nearly flat with a year ago. USDA's quote Thursday afternoon was US$148.34 compared with US$148.37 a year ago. Select beef prices are up slightly at US$142.30 versus US$138.10 a year ago.

 

Tighter supplies in the feedyards and higher feed costs are contributing to higher fed cattle prices. Trades in Texas/western Oklahoma and Kansas near midday Friday were reported at mostly US$95 with a few at US$95.50, generally steady with the previous week but up from mostly $90 the same week a year ago.

  

US cattle slaughter for the holiday-shortened week was estimated at 598,000 head, compared with 698,000 a week ago and 591,000 a year ago. Year-to-date slaughter stands at 23.321 million head, up 1.3 percent from a year ago.

 

Hog slaughter this week was estimated at 1.939 million head. Slaughter last week was estimated at 2.088 million, and the year-ago figure was 1.893 million. Year-to-date hog slaughter is 71.324 million head, up 2.4 percent from a year ago.

  

The USDA estimated total beef, pork and lamb production for the week at 856.0 million pounds. Last week's output was 964.7 million pounds. The year-ago figure was 844.2 million. Year-to-date combined meat output is 32.415 billion pounds, up 1.3 percent from last year.

 

Broiler/fryer slaughter for the week was estimated at 148.531 million head, compared with 171.530 million a week ago and 154.603 million a year ago.