By RON PLAIN

University of Missouri - Columbia

 

A strong dollar and labor problems at West Coast ports had a negative impact on pork exports at the start of 2015. U.S. pork exports were down 21.3 percent in January compared to 12 months earlier. January pork exports equaled 16.52 percent of U.S. production, the smallest share since August 2010. Year-over-year pork imports were up 32.3 percent in January with Canada and Poland accounting for most of the increase. January pork imports equaled 4.37 percent of production. Imports of weaner/feeder pigs from Canada were up 5.6 percent in January. Imports of other Canadian hogs were up 54.3 percent.

Compared to their February forecasts, USDA’s March WASDE lowered their estimate of 2015 beef production by 0.7 percent, increased their pork estimate by 0.1 percent, and upped expected broiler production by 0.2 percent. They lowered their estimate of 2015 exports for each of the major meats. USDA is now predicting a 3.1 percent increase in red meat and poultry production in 2015 compared to last year. That translates into 6.7 pounds more meat per person. USDA lowered by $1 per cwt. their forecasts of 2015 hog prices and broiler prices.

USDA increased by 50 million bushels each their estimate of corn exports and corn to be fed but lowered their forecast of corn used for ethanol production by 50 million bushels. They increased their estimate of season average corn price by 5 cents to between $3.50 to $3.90 per bushel.

The morning pork cutout value Friday, March 13, was $67.74 per cwt. FOB the plants. That is down 84 cents from the week before and down $54.91 from a year ago. This is the eighth consecutive week with a lower cutout value.

Thursday’s negotiated carcass price for plant delivered hogs averaged $60.64 per cwt., which was $3.37 lower than a week earlier and $50.88 lower than a year ago.

The Western Corn Belt had a Friday morning average negotiated carcass price of $59.87 per cwt. The Iowa-Minnesota average on the morning report March 13 was $60.01 per cwt. Because of confidentiality rules, there were no national or Eastern Corn Belt negotiated hog carcass price reports. Peoria had a top live price March 13 of $40 per cwt., $2 lower than seven days ago. The top price Friday for interior Missouri live hogs was $45.75 per cwt., which is down $1 from the previous Friday.

Hog slaughter last week totaled 2.227 million head, up 0.2 percent from the week before and up 10.0 percent from same week last year. Hog slaughter has been above the year ago level for the last eight weeks. The average live slaughter weight of barrows and gilts in Iowa-Minnesota last week was 284.2 pounds, unchanged from the week before and up 2.1 pounds from a year ago.

Hog futures were sharply lower last week. The April lean hog futures contract closed March 13 at $62.10 per cwt., down $4.02 for the week. May hog futures ended the week at $71.42 per cwt., down $5.83 from the week before. June hogs lost $4.63 last week to close at $75.42 per cwt. The March corn futures contract ended the week at $3.74/bu, down 5 cents for the week.

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