October 6, 2010

US pork stockpiles fall 27%

Pork stockpiles in the US fell 27% at the end of August from a year earlier as farmers cut the size of their herds and meat prices surged.

Warehouses held 384.9 million pounds of pork, down from 530.1 million on August 31, 2009, the USDA said in a report. Inventories shrank 1.6% from the end of July.

August pork output may have been 2.5% smaller than a year earlier, analysts said. The USDA will release production data for the month on September 24. In June, the hog-breeding herd was near the smallest size on record, as losses in 2008 and 2009 spurred culls.

US hog future's benchmark contract fell to a two-month low at the CME on Monday (Oct 4) due to lower cash hog prices, traders said.

October hogs closed down 0.700 cent at 75.675 cents per lb and December down 0.975 cent at 71.900, the lowest level for the December contract since August 11.