Ron Plain and Scott Brown
Ag Economics, MU
November 18, 2016
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This week's hog slaughter totaled 2.531 million head, up 3.2% from last week, up 5.7% from the same week last year, and if not revised, the second most ever in a week behind the 2,532,244 head slaughtered the week ending on November 5, 2016.
The U.S. imported 475,023 live hogs during September. That was 1.9% fewer than the month before, but 4.1 % more than a year ago. September imports of weaner/feeder pigs were up 11.5% compared to September 2015, but imports of other hogs down 25.1%.
Domestic retail meat demand was down 5.6% in September compared to a year earlier. Pork demand was down 1.9%, beef demand was down 7.6%, and chicken demand down 7.0%. Turkey demand was higher. September was the third consecutive month with lower domestic meat demand. Foreign demand for U.S. pork was down 1.9% compared to September 2015.
The average price of pork at retail during October was $3.743 per pound. That is 4.6 cents lower than the month before, 23 cents lower than October 2015, and the lowest for any month since February.
The live price for 51-52% lean hogs averaged $37.07/cwt in October, the lowest monthly average since August 2009.
The national negotiated barrow and gilt carcass price averaged $40.06/cwt on the morning report today, down $1.09 from a week earlier and down $10.11 from a year ago. The western corn belt averaged $39.66/cwt this morning, down $1.55 from a week ago. Neither the eastern corn belt nor Iowa-Minnesota had a morning price quote today.
Friday morning's pork cutout value was $72.94/cwt FOB slaughter plants. That is down $1.96 from the week before and down $1.06 from a year ago. Loin prices continue to be very weak. This morning's average loin price ($66.96/cwt) is only 91.8% of the pork cutout value and is lower than primal hams ($74.28/cwt). This morning's national negotiated hog carcass price is only 54.9% of the cutout value.
The top hog price today at Peoria was $25/cwt, unchanged from a week ago. Today's top price for interior Missouri live hogs was $27.75/cwt, also unchanged from last Friday.
The average slaughter weight of barrows and gilts in Iowa-Minnesota last week was 280.9 pounds. That is up 0.1 pound from the week before, but down 2.8 pounds from the same week last year.
Hog futures were mixed this week. The December lean hog futures contract ended the week at $47.80/cwt, up 67.5 cents from the preceding Friday. February hogs settled at $54.175/cwt, down 17.5 cents from last Friday. The April contract settled at $61.125, down 62.5 cents for the week. June hogs settled at $73.25 today.
Corn futures ended the week higher than last week. The December corn futures contract settled at $3.455 per bushel up 5.25 cents for the week. March corn futures closed at $3.535/bu, up 4.5 cents from last Friday. May corn futures ended the week at $3.60/bu. July corn settled at $3.6725/bushel.
Source: AGEBB