October 2, 2012
The hog and pig inventory of the US is 67.5 million heads as of September 1, a slight rise from September 1, 2011 and up 3% from June 1, 2012.
Breeding inventory, at 5.79 million heads, was down slightly from last year, and down 1% from the previous quarter. Market hog inventory, at 61.7 million heads, was up slightly from last year, and up 3% from last quarter.
The June-August 2012 pig crop, at 29.3 million heads, was down slightly from 2011. Sows farrowing during this period totalled 2.89 million heads, down 1% from 2011. The sows farrowed during this quarter represented 49% of the breeding herd.
The average pigs saved per litter was a record high 10.13 for the June-August period, compared to 10.03 last year. Pigs saved per litter by size of operation ranged from 7.60 for operations with 1-99 hogs and pigs to 10.20 for operations with more than 5,000 hogs and pigs.
US hog producers intend to have 2.85 million sows farrow during the September-November 2012 quarter, down 3% from the actual farrowing during the same period in 2011, and down 1% from 2010. Intended farrowing for December-February 2013, at 2.82 million sows, are down 1% from 2012 and down 1% from 2011.
The numbers were about what analysts were expecting, and indicate that prices will rise through 2013, said economists on a media conference call hosted by the National Pork Board and the Pork Checkoff.
"It's pretty obvious that the industry's gone into pretty significantly contraction," said Dan Vaught, president of Vaught Futures Insight in Altus, Arkansas. "[Farrowing] intentions pretty much matched expectations so [we're] moving into a contraction faster than expected - not surprising, given the big surge in corn."
The trend will yield "smaller hog and pork supplies by next spring and summer and a significant increase in prices," he said.
The industry is seeing a "reduction in the number of gilts being retained," noted Altin Kalo, chief economist for Steiner Consulting Group. "We basically have made a U-turn here from where we were in May and June when producers were looking to expand the herd.
"That has implications for pork production mostly for 2013, especially at the back end," Kalo said.
In the fourth quarter, the economists projected that hog prices would range from a low of US$60 per counterweight to US$77 per counterweight. By the second quarter of 2013, they projected a price range for hogs between US$80 per counterweight and US$107 per counterweight.