Both live hogs and live fed cattle demand was up substantially for the first eight months of 2007 compared to a year earlier. Live hog demand for this period was up 3.3 percent and live fed cattle demand was up 3.8 percent.

Most or all of the increase in live hog demand came from the domestic market. Retail pork prices were up 2.3 percent but the total markets margin was up only 1.3 percent.

Therefore, most of the increase in retail price was bid through to the live animal.

The following table presents production information about U.S. hog producers based on a study by the University of Missouri and Iowa State University with financial assistance from National Pork Board, Pig Improvement Company and Pork magazine.

Production Information

2006 Percent of U.S. Hogs Affected

Feed is self-prepared - 54 percent
Replacement gilts are purebred - 32 percent
Hogs are raised indoors – 94 percent
Feeding is split serve – 64 percent
Facilities are wean to finish – 29 percent
Grain raised by own farm – 35 percent

The grain raised by own farm fluctuates from 2 percent for produce production 500,000 or more hogs annually to 79 percent for the produce producing 3,000-5,000 hogs annually. With the higher corn price expected for the foreseeable future this increases the competitiveness of the farms that produce most or all of their grain needs.

The average live weight for the week ending Oct. 6 was 268.1 pounds per head up 0.8 pound from a week earlier and up 1.5 pounds per head from a year earlier. There appears to be enough market ready hogs to keep slaughter at record high levels.

Pork product prices rallied a bit this week in the face of record slaughter. Rumor is that export to Russia is helping.

The cut out per cwt. of carcass on Oct. 11 was at $61.47 per cwt., up 77 cents per cwt. from a week earlier. Loins were up $2.95 per cwt. at $75.77 per cwt.; Boston butts at $59.16 per cwt. up 39 cents per cwt.; hams up $2.54 per cwt. at $52.13 per cwt. and bellies at $73.41 per cwt. down 58 cents per cwt from a week earlier.

Top live hog prices on Oct. 12 were steady to 50 cents per cwt. higher compared to a week earlier.

Weighted average negotiated carcass prices by area on Oct. 12 were $1.22 to $3.30 per cwt. higher compared to seven days earlier. Slaughter this week under Federal Inspection was estimated to be another record high at 2.348 million head, up 1.2 percent from last week’s record number and up 8.7 percent from the same week in 2006.

Feeder pig prices last week at United Tel-O-Auction were $10-20 per cwt. below two weeks earlier. All of the pigs weighed between 50-60 pounds sold from $56-$63 per cwt.

The views and opinions expressed in this column are those of the author and not necessarily those of Farm World. Readers with questions or comments for Ron Plain or Glen Grimes may write to them in care of this publication.