Ron Plain: Hog Outlook

Ron Plain and Scott Brown
University of Missouri
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U.S. pork exports during April were 9.9% greater than in April 2013. The big increases were in shipments to South Korea, Japan and Mexico. Total pork exports during the first third of 2014 were up 10.3% compared to January-April 2013. This is a remarkable performance given how high pork prices have been. Pork exports in April equaled 22.8% of production.

Pork imports during April were up 13.9% with several countries shipping more pork to the U.S. Total pork imports during the first third of 2014 were up 5.3% compared to January-April 2013. April imports equaled 4.1% of U.S. pork production. April imports of live hogs from Canada were down 4.2% compared to last April. January-April hog imports were down 8.4%.

This week Secretary of Agriculture Tom Vilsack announced new mandatory reporting requirements for the PED virus. It is hoped that enhanced tracking will lead to better containment of this rapidly spreading disease.

The Labor Department says 217,000 jobs were added to the U.S. economy during May. That is not a large number, but it was big enough to cause the unemployment rate to hold steady at 6.3%.

For the first time we can remember, there was no National hog carcass price quote this morning. Nor were there regional quotes for the eastern corn belt, the western corn belt, or Iowa-Minnesota. The National average carcass price for Thursday was $109.54/cwt, up $1.73 compared to 7 days earlier. Peoria had a top live price today of $74/cwt. There was no quote from Zumbrota, MN this morning. The top price Friday for interior Missouri live hogs was $77.75/cwt which was 75 cents higher than the previous Friday.

Friday morning's pork cutout value was $119.59/cwt FOB the plants, up $5.40 from the week before and up $23.49 from a year ago.

Hog slaughter this week totaled 1.93 million head, up 10.3% from the previous holiday-short week before, but down 3.8% compared to last year.

The average live slaughter weight of barrows and gilts in Iowa-Minnesota last week was 286.7 pounds. That was unchanged from the week before and 10.0 pounds heavier than a year ago.

The June lean hog futures contract today closed at $114.57/cwt, up $1.22 for the week. July hog futures ended the week at $124.97/cwt, up $4.50 from the week before. August hogs also gained $4.50 this week to close at $129.30/cwt. The October contract ended the week at $107.77/cwt; December at $94.60/cwt.

This week's USDA Crop Progress report said that 95% of corn acres were planted by June 1. That is 7 points more than the week before, 5 points ahead of last year, and 1 point ahead of the 5 year average.

Corn futures were lower this week. The July contract lost 7 cents this week to close at $4.59. The September contract ended the week at $4.5625, down 2 cents from the previous Friday. December corn futures ended the week at $4.5775/bu.

Source: AGEBB