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Market conditions make last week good for hog producers
Hog Outlook
Glenn Grimes & Ron Plain
University of Missouri - Columbia

Pork exports during April were up only 1.1 percent from a year earlier. For January-April, pork exports are up 16 percent.

Even though pork exports for April were up only slightly, they were the second largest monthly pork exports of record. Pork exports in April were also a record high as a percent of production at 15.9 percent, and net exports as a percent of production, at 11 percent.

For some reason, pork exports to Japan are down substantially. Based on available data, Japan’s total pork purchases are down more from other countries than from the U.S. as a percent of purchases.

For January-April, Japan’s purchases from the U.S. were down 9.7 percent, Canada’s up 12.4 percent, Mexico’s up 27.9 percent, Russia’s up 141.6 percent, South Korea’s up 64 percent, mainland China and Hong Kong’s up 42.6 percent, Taiwan’s up 63.8 percent, Caribbean’s up 59.7 percent, and others’ up 2 percent.

Pork imports by the U.S. for January-April were up 5.4 percent from the same months in 2005.

Imports of live hogs continue to run well above 2005 for January through April, up 12.3 percent. Feeder pig imports were up 16.1 percent for these four months and slaughter hog imports were up 4.2 percent compared to a year earlier.

Demand for pork at the consumer level in January-April was not down as much as our preliminary data indicated. At a loss of 5.7 percent, it is still very undesirable, but that is still better than our preliminary estimate of 6.1 percent. The demand for beef and broilers turned out to be bigger losses than our preliminary data indicated. With all of the data in, beef demand at the consumer level for January-April was down 5.3 percent rather than 4.1 percent from 12 months earlier. Broiler demand for January-April was down 6.0 percent rather than 5.1 percent based on preliminary data.

Retail pork prices for May were down 1.1 percent from April and down 4.4 percent from May 2005. Retail pork prices for January-May of 2006 were down 2.4 percent from the same period a year earlier.

The total marketing margin for January-May was up 4.3 percent from 2005. The processor and retailers’ margin was up 4.4 percent and the packers’ margin was up 4.0 percent for January-May compared to a year earlier.

Both the marketers and consumers benefited from the lower live hog prices. The live prices for hogs for January-May were down 16.7 percent in 2006 from a year earlier.

We appear to be very current with marketings, at least in the Midwest. The average weights last week in Iowa-Minnesota were at 264.3 pounds, down 2.2 pounds from last week and down 2.5 pounds from last year.

This has been a good week for the hog producers. Top live prices this Friday morning were up $3 to $4 per cwt. from a week earlier. Average weighted carcass prices on Friday morning were up $4.33 to $5.74 per cwt. from seven days earlier. Pork product cutout for Thursday afternoon was up $3.30 per cwt. from the prior Thursday. The top prices Friday morning for selected markets were: Peoria $53 per cwt., St. Paul $58 per cwt., Sioux Falls $59 per cwt., and interior Missouri $55 per cwt.

The average weighted carcass prices by area Friday morning were: western Corn Belt $77.41 per cwt., eastern Corn Belt $74.57 per cwt., Iowa-Minnesota $77.76 per cwt., and nation $76.06 per cwt. Slaughter this week under Federal Inspection was estimated at 1,823,000 head, down 4.8 percent from a year earlier.

This farm news was published in the June 21, 2006 issue of Farm World, serving Indiana, Ohio, Illinois, Kentucky, Michigan and Tennessee.