Ron Plain and Scott Brown
Ag Economics, MU
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The average retail price of pork during May was $3.781 per pound. That is down 1.8 cents from the month before, but up 8.5 cents from a year earlier. Bacon prices were higher than last May, but chop and ham prices were lower.
The average live price for 51-52% lean hogs was $54.75/cwt in May. That the highest monthly average since August.
Calculations by Lee Schulz at Iowa State University put the average profit at $25.01 per head for market hogs sold in May. May was the fourth consecutive profitable month for Iowa farrow to finish operations and the most profitable since May of last year. Dr. Schulz estimates the cost of production at $45.38/cwt (live weight) or $60.50/cwt of carcass for hogs marketed in May.
USDA will release their June hog inventory survey data next Friday. There may be a small downward revision in the market hog inventory. Since March 1, barrow and gilt slaughter has been roughly 0.5% lower than implied by the March market hog inventory.
USDA's Crop Progress report says that 75% of corn acres were in good to excellent conditions on June 12. That is the same as a week earlier and 2 points higher than on that date last year.
The national negotiated barrow and gilt carcass price averaged $80.35/cwt on Thursday, up $2.79 from a week earlier and up $4.12 from a year ago.
The national negotiated barrow and gilt price averaged $79.50/cwt on the morning report today, up $3.06 from a week earlier and up $4.45 from a year ago. The western corn belt averaged $81.03/cwt this morning, up $4.46 from last Friday morning. Iowa-Minnesota averaged $81.05/cwt. There was no negotiated price quote this morning for the eastern corn belt.
The top hog price today at Peoria was $49/cwt, up $1 from last Friday. The top price for interior Missouri live hogs was $54.75/cwt, up $3.00 from a week ago.
Friday morning's pork cutout value was $88.63/cwt FOB the slaughter plants. That is up $2.00 from the week before and up $6.45 from a year ago. Loin, ham and belly prices were all higher than last Friday. This morning's national negotiated hog price is 89.7% of the cutout value.
This week's hog slaughter was 2.16 million head, up 3.5% from last week and up 1.3% from the same week last year. The average slaughter weight of barrows and gilts in Iowa-Minnesota last week was 281.9 pounds. That is down 1.2 pounds from the week before, but up 1.0 pound from the same week last year.
The July lean hog futures contract ended the week at $86.175/cwt, up 47.5 cents from the preceding Friday. Today, August hogs settled at $89.175/cwt, up $2.55 from last Friday. The October contract settled at $74.325, up $1.525 for the week.
Corn futures keep moving higher. The July contract gained 14.75 cents this week to close the week at $4.3775 per bushel. December corn futures ended the week at $4.4875/bushel, up 18 cents from last Friday.
Source: AGEBB