August was a good month for pork retailers. Compared to a year ago, August hog prices were down 30.5%, the farm-to-wholesale price spread was down 2.9%, but the wholesale-retail price spread as up 2.9%.
Calculations by Lee Schulz at Iowa State University estimated the average profit for market hogs sold during August by Iowa farrow-to-finish operations at $20.27 per head. August was the fifth consecutive profitable month. The August breakeven price was estimated to be $48.34/cwt (live) or $64.45/cwt (carcass).
The national negotiated barrow and gilt price on the morning report today was $65.64/cwt, up $1.16 from last Friday morning. The eastern corn belt averaged $65.80/cwt this morning. There were no negotiated price quotes this morning for the western corn belt or for Iowa-Minnesota.
Peoria had a top live price today of $44/cwt, unchanged from last Friday. The top price today for interior Missouri live hogs was $46/cwt, down 75 cents from the previous Friday.
This morning's pork cutout value was $83.53/cwt FOB the plants. That is down 84 cents from the week before. Packer margins continue to be very good. This morning's national negotiated hog price was only 78.6% of the cutout value.
This week's hog slaughter totaled 2.278 million head, up 11.7% from last week which was light because of the Labor Day holiday and up 11.7% from the same week last year.
The average live slaughter weight of barrows and gilts in Iowa-Minnesota last week was 280.6 pounds, up 3.2 pounds from a week earlier, but down 1.3 pounds from a year ago. This was the 25th consecutive week with weights lighter than last year.
It was a good week for hog futures. The October lean hog futures contract settled today at $71.05/cwt, up $3.725 for the week. Surprisingly, the October contract is well above the current cash market. December hog futures ended the week at $64.15/cwt, up $1.50 from the week before. February hogs gained $1.725 this week to close at $68.375/cwt. The April contract ended the week at $72.10/cwt. Hog futures prices imply a temporary shortage of hogs is coming next month.
The December corn futures contract lost 9.5 cents this week to close at $3.7725/bushel.