December 28, 2012

The averaged US retail pork prices in November was US$3.478 per pound, US$0.06 lower than in October and US$0.033 lower than in November 2011.

The national average live price for 51-52% lean barrows and gilts in November was US$57.67/cwt. That was US$1.39 lower than in October and US$5.73 lower than in November 2011. Hogs prices this year are the second highest ever, but because of record feed costs this has been a very unprofitable year for producers. Carcass price will average close to US$82/cwt and losses will average above US$10 per head.

Next Friday (Jan 4), USDA will publish the results of their December hog inventory survey. I am predicting they will say the breeding herd is 0.9% smaller than a year ago and the market hog inventory is 0.7% smaller than on December 1, 2011.

The first major snow storm of the winter hit the Midwest this week disrupting hog movement late in the week. Thursday's (Dec 20) hog slaughter was only 344,000 head, down 89,000 from the week before.

The national average negotiated carcass price for direct delivered hogs on the morning report Thursday (Dec 27) was US$78.74/cwt, up US$0.18 from last Friday (Dec 21). The western Corn Belt was US$3.78 lower than last Friday at US$78.72/cwt. Neither the eastern Corn Belt nor Iowa-Minnesota had a morning price quote Thursday (Dec 27). Peoria had no Friday hog sales report. Zumbrota had a live top today of US$53/cwt. The top for interior Missouri live hogs Friday was US$57.00/cwt, downUS$0.75 from the previous Friday.

The Thursday afternoon calculated pork cut-out value was US$81.90/cwt, down US$1.93 from the previous Thursday. As is typical of mid-December, ham prices took a big hit losing 10% of their value during the week. Loins and butts are higher. The pork cut-out value is US$5.27/cwt lower than a year ago.

Hog slaughter this week totalled 2.348 million head, up 1.9% from the week before and up 8.9% compared to the same week last year. The national average hog carcass price is 96.1% of the cut-out value, which is high for this time of year. Because of Christmas, hog slaughter will be very light next week.

The average barrow and gilt live weight in Iowa-Minnesota last week was 273.6 pounds, 1.3 pounds below a week earlier and down 1.6 pounds from a year ago. This was the 12th consecutive week with weights under the year-ago level. Year-to-date hog slaughter is up 2.0% while pork production is up 2.1%.

Friday's (Dec 21) close for the February lean hog futures contract was US$86.90/cwt, up US$1.50 from the previous Friday. April hog futures ended the week US$1.22 higher at US$91.62/cwt. May hogs settled at US$98.70/cwt; June at US$100.65/cwt.