Search Site   
Current News Stories
Pennywise, dollar-foolish move amounts to big food, ag loss
USDA raises estimates for corn and soybeans, again
Sale Calendar - September 19, 2018
Views and opinions: Farmers getting used once again
Views and opinions: September slips away – and so do solutions
Views and opinions: Newest technology great for discovering old artists
Spotlight on Youth - September 19, 2018
Views and opinions: Farmer suicide could hurt food production, security
Views and opinions: Name your poison, and take your chances with the cows
Views and opinions: Spiritual blessings for you, and not just your neighbor
Views and opinions: Last high chance of 80s will be at the end of September
News Articles
Search News  
September hog numbers up 2 percent; more growth is ahead

DES MOINES, Iowa — Based on last month’s hog and pig inventory, which was up 2 percent, farm market analysts forecast healthy and profitable growth ahead for the U.S. pork industry.

“Much of the report came out as expected,” said Steve Meyer, vice president of pork analysis for Express Markets, Inc. Analytics in Fort Wayne, Ind., in analyzing the Sept. 1 USDA Quarterly Hogs & Pigs report during a Sept. 28 teleconference.

Sponsored by the National Pork Board and the pork checkoff in Des Moines, the report was analyzed by Kevin Grier, president of Kevin Grier Market Analysis and Consulting in Guelph, Ontario; Altin Kalo, senior analyst for Steiner Consulting Group in Merrimack, N.H.; and Ron Plain, professor emeritus of agricultural economics at the University of Missouri-Columbia.

“By and large, the industry is profitable, and we’re growing,” Plain said. “Demand is good, exports outlook looks good, so we anticipate more pork. The numbers don’t work out quite as much more pork as the USDA/WASDE (World Agricultural Supply and Demand Estimates) is forecasting, but by and large the industry is alive and well.”

This new hog growth, Meyer said, is thanks to last month’s openings of new processing plants in Sioux City, Iowa, and Coldwater, Mich. “The plants opened as scheduled; they will continue to ramp up.”

According to the report, the inventory of all hogs and pigs on Sept. 1 was 73.5 million head, up 2 percent from Sept. 1, 2016, and 3 percent from June 1 this year. The report added U.S. market hog inventory, at 67.5 million, was up 3 percent from last year and from last quarter.

“If you’re a corn farmer, it makes a lot of sense to convert that corn into a value-added product in the form of pork,” Kalo said. “The market continues to reward expansion. I’m surprised there hasn’t been more expansion. The industry has been fairly disciplined, given the profitability in place.”

The report stated U.S. breeding inventory, at 6.09 million head, was up 1 percent from last year and up slightly from the previous quarter. June-August 2017 pig crop, at 33 million, was up 2 percent from 2016. Sows farrowing during this period totaled 3.1 million head, up 2 percent from 2016.

In addition, the sows farrowed during this quarter represented 51 percent of the breeding herd. The average pigs saved per litter was a record high of 10.65 for the June-August period, compared to 10.58 last year. Pigs saved per litter by size of operation ranged from 7.8 for operations with 1-99 head, to 10.7 for operations with more than 5,000.

“When you look at breeding herd and farrowing numbers, things seem to match up,” Kalo said. “Slaughter numbers are starting to pick up and are likely to continue through the end of this year. Expect these numbers to stay around 2 percent or higher compared to a year ago.”

In fact, he said this fall hog slaughter levels have broken new records, with packer capacity also increasing.

“We forget the fact that a lot of this pork is going to the consumer and getting used up,” he said. “Now it’s taking somewhat lower prices to get that done, but those lower prices are still profitable for the producer, and the export markets are absorbing a fair amount of the pork, as well.

“The July numbers were a little lower, but they were lower because prices were pretty high. When you look at the weekly export number for August, and then September, I think for September, I think we’re on track to have export numbers somewhere around 8, 9 percent, maybe 10 percent above a year ago.”

Despite porcine epidemic diarrhea (PED) virus concerns this spring and summer, Grier said Canada is also experiencing hog expansion. “Pretty well all of it has been associated in the province of Manitoba, southeast Manitoba. It’s resulted in a decline in feeder pigs into Iowa and Minnesota of about 10,000 head a week this summer, and those would have been hitting the market in the fourth quarter.

“The reality of it is that finishers in Iowa and southern Minnesota certainly saw those declines this summer; their orders were not filled this summer; and the packers took a look at these with a certain amount of concern – especially those that are aware of the fact that more competitive capacities are coming onstream,” he added.

The report said U.S. hog producers intend to have 3.07 million sows farrow during the September-November 2017 quarter, up 1 percent from actual farrowings during the same period in 2016 and 5 percent from 2015. Intended farrowings for December-February 2018, at 3.02 million, are up 1 percent from 2017, and 3 percent from 2016.

The total number of hogs under contract owned by operations with more than 5,000 head, but raised by contractors, accounted for 47 percent of the hog inventory, unchanged from the previous year.

As the nation’s top hog producer, Iowa farmers accounted for the largest inventory among the states, at 21.8 million head, the report said. North Carolina and Minnesota had the second and third largest inventories, with 9.2 million and 8.3 million, respectively.

The report said Illinois’ total hogs and pigs were 5.5 million animals, up 3 percent from June 1 and up 10 percent from last year. Indiana’s total hog and pig inventory was estimated at 4.15 million, up 150,000 from a year ago.

Michigan’s total hog and pig inventory was estimated at 1.18 million head, up 40,000 from a year ago, and Ohio’s total hog and pig inventory was estimated at 2.85 million, up 250,000 from a year ago.

“Bottom line, the industry is alive and well,” Plain said. “The slaughter capacity gives us room to grow production. I think we are going to make sure there are enough hogs to keep those employees in the new plants busy.”