DES MOINES, Iowa – As the nation’s first official swine inventory of 2023, the March 1 USDA Quarterly Hogs & Pigs Report showed numbers that closely lined up with pre-report estimates – but with a few surprises, according to agricultural economists.

“The March-May intention numbers and the June-August intention numbers: those are down 1.2 and 2.9 percent (respectively), and those are large declines, given a breeding herd that’s slightly larger,” Steve Meyer, Partners for Production Agriculture in Ames, Iowa, told reporters in a March 30 webinar shortly after the report’s release.

Meyer joined Bill Even, CEO of the National Pork Board in Des Moines; Katelyn McCullock, director and senior economist at the Livestock Marketing Information Center in Lakewood, Colo.; and Altin Kalo, chief economist at Steiner Consulting Group in Manchester, N.H., to analyze the report.

“We’re scratching our heads over whether we agree with the report, or not,” Meyer said. “You always have to make that call at some point as an analyst, but we think there are some numbers here that are a little iffy.

“I’m not surprised by anything in there,” he added. “I don’t think we’re getting much information that is useful from those farrowing intentions because they just don’t fit. Our take on this was neutral to possibly a little bullish in the long term.”

Sponsored by the National Pork Board and the Pork Checkoff in Des Moines, the report said U.S. inventory of all hogs and pigs on March 1, 2023, was 72.9 million head, up slightly from March 1, 2022, but down 2 percent from Dec. 1, 2022. Market hog inventory, at 66.7 million head, was up slightly from last year, but down 2 percent from last quarter.

The report said the U.S. breeding inventory, at 6.13 million head, was up slightly from last year, but down slightly from the previous quarter.

Kalo said he and his fellow analysts saw a shift of where the breeding herd is located.

“Compared to a year ago, the sow inventory in Illinois, Indiana, Missouri and South Dakota is increasing by about 135,000 head, while the inventory in Minnesota, Nebraska and Utah are down by about 125,000 head,” he said. “What we’ve noticed on the breeding herd is that the producers are basically in a maintenance phase at this point.”

The report said Iowa hog producers on March 1 accounted for the nation’s largest inventory, at 23.4 million head. Inventory was down 3 percent from the previous quarter, but up 1 percent from the previous year. The December 2022-February 2023 quarterly pig crop was 5.38 million head, down 10 percent from the previous quarter, but up slightly from last year.

A total of 470,000 Iowa sows farrowed during this quarter. The average pigs saved per litter was 11.45 for the quarter. As of March 1, producers planned to farrow 490,000 sows and gilts in the March-May 2023 quarter, and 505,000 head during the June-August 2023 quarter.

The report said Minnesota had the second largest inventory at 8.9 million head; and North Carolina was third, with 8 million head.

In Indiana, total hog and pig inventory was estimated at 4.3 million head, up 50,000 head from a year ago, according to State Statistician Nathanial Warenski. Breeding hog inventory, at 260,000 head, was up 10,000 from last March.

Indiana’s market hog inventory, at 4.04 million head, was up 1 percent from last year. The average pigs saved per litter for the December-February 2023 quarter was 11.20, compared to 10.40 last year.

In Illinois, total hog and pig inventory was 5.35 million head, down 2 percent from Dec. 1, 2022, but up 1 percent from last year. Breeding inventory, at 660,000 head, was unchanged from the previous quarter, but up 70,000 from last year. Market hog inventory, at 4.69 million head, was down 2 percent from last quarter and down slightly from last year.

Illinois’ December-February 2023 pig crop, at 2.97 million head, was up 8 percent from 2022. Sows farrowing during this period totaled 280,000 head, up 20,000 from a year ago. The average pigs saved per litter was 10.60 for the December-February period, unchanged from last year.

In Michigan, total hog and pig inventory was estimated at 1.24 million head, up 50,000 head from a year ago, according to Marlo D. Johnson, USDA Great Lakes regional director. Breeding hog inventory, at 115,000 head, was up 5,000 from last March.

Michigan’s market hog inventory, at 1.13 million head, was up 4 percent from last year. The average pigs saved per litter for the December-February 2023 quarter was 10.70, compared to 11.10 last year.

In Ohio, total hog and pig inventory was estimated at 2.65 million head, up 50,000 head from a year ago. Breeding hog inventory, at 190,000 head, was unchanged from last March. Market hog inventory, at 2.46 million head, was up 2 percent from last year.

Ohio’s average pigs saved per litter for the December-February 2023 quarter was 10.70, compared to 11.50 last year. (Kentucky and Tennessee were not included in the report).

The report said the nation’s December 2022-February 2023 pig crop, at 32.1 million head, was up slightly from last year. Sows farrowing during this period totaled 2.91 million head, down slightly from previous year. The sows farrowed during this quarter represented 47 percent of the breeding herd.

Moreover, U.S. hog producers intend to have 2.93 million sows farrow during the March-May 2023 quarter, down 1 percent from the actual farrowings during the same period one year earlier, and down 3 percent from the same period two years earlier, the report said.

The report added intended farrowings for June-August 2023, at 2.97 million sows, are down 3 percent from the same period one year earlier, and down 3 percent from the same period two years earlier.

“I think probably what gave me pause was those farrowing intentions were quite a bit lower than maybe we were expecting, at least as of March 1,” McCullock said. “Now, if we don’t see some price increases this summer, maybe producers are looking at continued lower profitability or negative returns moving forward, and those might come to fruition.

“But I think it’s more of a ‘let’s keep an eye on what those headwinds are looking like and see if we can get a few more farrowings in there from where the intentions are estimated at,’ and it’s a little bit of a moving target at this point,” she added.

Meyer said farrowing intentions might be accurate, especially given the current profit outlook.

“There might be producers that reported, let’s say they were average, and they were a half percent larger than a year ago, but their intentions are to reduce that sow herd and reduce their farrowings in the summer,” he said.

“That is a possibility, and I think the thing to watch on that will be what the level of sow slaughter is over the next six to eight weeks, and whether that liquidation, (whether) we can see that in the sow slaughter numbers,” he added.

He said, “I kind of compare everything to the breeding herd and then this climate with a very negative profit outlook, maybe the farrowing intentions are the right yardstick, and the others are going to come to meet it.”

McCullock said, “We’re expecting hog slaughter to remain above a year ago, at least in the near term, and then some of those lighter farrowing intentions are going to come to fruition later in the year.

“I think the price impact here is pretty clear so far with that we have more hogs on the market than maybe where you’re anticipating, and based on what that supply picture that the report painted, that at least in the near term, you’re going to need some help from the demand side, at least heading into the 4th of July to really get this base hog price up,” she added.