The U.S. and China have reached an agreement to reopen China to U.S. pork. The Chinese government disrupted shipments last year over H1N1 concerns. The Chinese market has big potential. In 2008, the U.S. shipped over 360 million pounds of pork to China. China currently has high hog numbers and low hog prices, so a sudden surge of U.S. pork into China is unlikely.

Retail pork prices increased during February for the third month in a row. The average price of pork at retail in February was $2.917 per pound. That is 3.9 cents higher than in January, but 4.4 cents lower than in February 2009. Domestic pork demand continues to be weak. Retail pork prices are lower this year even though the domestic pork supply has been below year-earlier levels.

The average live hog price was $6.55 per cwt. higher in Feb. than 12 months earlier. Since higher hog prices have not been passed through to consumers, they have come out of middlemen’s pockets. That is a good deal for hog producers, but it is not sustainable.

Hog prices dropped lower this week. The national weighted average carcass price for negotiated hogs Friday morning was $66.36 per cwt., $3.74 lower than the previous Friday. Regional average prices on Friday morning were: eastern Corn Belt $66.09, western Corn Belt $67.23, and Iowa-Minnesota $67.24 per cwt. The top hog price Friday at Sioux Falls was $47.50 per cwt., down $3.50 from the previous Friday. Zumbrota, Minn. had a top price of $48 on Friday and Peoria topped at $44 per cwt. The interior Missouri live top Friday was $48.25 per cwt., $1.75 lower than the previous Friday.

USDA’s Thursday afternoon calculated cutout value was $72.68 per cwt., down $1.43 from the previous Thursday, but up $11.88 compared to the same day last year. Loins and hams were lower this week, but bellies and butts ended the week higher.

This week’s hog slaughter totaled 2.166 million head, up 1.6 percent from the week before and up 0.4 percent compared to the same week last year. This is the first week above year-ago since New Year’s week. Since Dec. 1 hog slaughter has been 1.5 percent lower than indicated by the December hog inventory. USDA will release the results of their March hog survey next Friday.

The average carcass weight of barrows and gilts slaughtered the week ending March 6 was 201 pounds, up 1 pound from the week before but down 1 pound from the same week last year. Iowa-Minnesota live weights last week averaged 270.5 pounds, up 1.8 pounds compared to a year earlier.

Year-to-date pork production is down 5.8 percent compared to the same period in 2009.

The April lean hog futures contract ended the week at $73.35 per cwt., up 70 cents from last Friday. The May contract settled at $79.90, up $1.95 for the week. June closed the week at $82.57 per cwt. and July ended at $83.15 per cwt.

May corn futures gained 10 cents this week and settled at $3.745 per bushel on Friday.

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 Glenn Grimes or Ron Plain may write to them in care of this publication.