USDA’s November World Agricultural Supply and Demand Estimates predicted that U.S. meat production would be up 2.9 percent in 2016 with pork up 1.7 percent, beef up 4.8 percent, broilers up 1.9 percent and turkey up 7.9 percent. More meat is likely to mean lower prices. USDA expects hog prices to average $1-$4 lower next year than this.
Last week was another down week for hog prices. The average negotiated price for barrows and gilts purchased on Thursday (Nov. 12) for slaughter plant delivery was $51.33 per cwt., down $3.14 from a week earlier and down $17.93 from three weeks ago.
The national average negotiated carcass price on the morning report Friday, Nov. 13, was $50.69 per cwt., down $2.67 from a week earlier. Neither the Western Corn Belt, nor Iowa-Minnesota, nor the Eastern Corn Belt had a morning negotiated price quote Friday.
Peoria had a top live price Friday, Nov. 13, of $30 per cwt., down $6 from the previous Friday. The top price Nov. 13 for interior Missouri live hogs was $33 per cwt., down $5.50 from the previous Friday.
The morning pork cutout value Nov. 13 was $73.04 per cwt. FOB the plants. That is down $3.03 from the week before.
Hog prices continue to be very weak compared to the cutout value. The morning national average hog carcass price Friday, Nov. 13, was only 69.4 percent of the pork cutout value.
Last week’s hog slaughter totaled 2.388 million head, up 1.2 percent from the previous week and up 7.5 percent from the same week last year. This was the largest hog slaughter for any week since the week ending Dec. 1, 2012.
The average live slaughter weight of barrows and gilts in Iowa-Minnesota last week was 284.3 pounds, up 1.6 pounds from a week earlier, but down 1.4 pounds from a year ago. This was the 33rd consecutive week with weights lighter than a year ago.
Hog futures were lower last week. The December lean hog futures contract settled Nov. 13 at $54.80 per cwt., down 20 cents for the week. February hog futures ended the week at $57.05 per cwt., down $1.25 from the week before. April hogs lost $1.63 last week to close at $62.225 per cwt. The June contract settled at $73.15 per cwt.
USDA raised their estimate of corn yield by 1.3 bushels to 169.3 bushels per acre. That is the second highest corn yield ever behind last year’s 171 bushels per acre. Corn production is expected to total 13.654 billion bushels, the third highest ever after 2014 and 2013. USDA is predicting the seasonal average corn price will average close to $3.65 per bushel, down 5 cents from the year before.
The December corn futures contracted settled at $3.5825 per bushel Friday, Nov. 13. That is down 14.75 cents from the previous Friday.
USDA increased their estimated soybean yield by 1.1 bushels to a record 48.3 bushels per acre. They estimate this year’s harvest at a record 3.981 billion bushels. Both records break the 2014 records. USDA expects the marketing year average price for soybeans to average close to $8.90 per bushel, down $1.20 from the year before. They expect soybean meal to average between $300 and $340 per ton.
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.
