Hog Outlook
Ron Plain and Scott Brown
University of Missouri
The Department of Labor says 288,000 jobs were added to the U.S. economy in April. More people working should be positive for meat demand.
This week's USDA Crop Progress report says that 19% of corn acres were planted by April 27. That was 14 points ahead of last year, but 9 points below the 5 year average.
USDA's annual Meat Animal Production, Disposition, and Income summary for 2013 says that 17.2% of the 2013 pig crop was born in Iowa, but Iowa accounts for 27.8% of hog marketings and 32.4% of cash receipts from hog sales. Why the disparity? The tremendous number of young pigs that are shipped to Iowa for feeding. Over 55% of the 45 million hogs that changed states for feeding in 2013 went to Iowa. Last year Missouri hog farms ranked fifth in pig crop and sixth in cash receipts.
Hog weights keep setting records. The average live weight of barrows and gilts in Iowa-Minnesota last week, 287.5 pounds, was record high for the sixth consecutive week. Last week's average was up 1.1 pounds from a week earlier and up 9.5 pounds from a year ago. Prior to early November, we had never seen a week with Iowa-Minnesota average live weights above 280.0 pounds. Since then we have not had a week with weights below that level.
Cash hog prices this week were lower for the fourth consecutive week. The national average negotiated carcass price for direct delivered hogs on the morning report today was $109.19/cwt, down 5 cents from last Friday, but up $24.63 from a year ago. There was no eastern corn belt price report this morning. The western corn belt averaged $112.26/cwt this morning as did Iowa-Minnesota. Peoria and Zumbrota both had a top live price today of $76/cwt. The top price Friday for interior Missouri live hogs was $76.50/cwt which was down $3.50 from the previous Friday.
Friday morning's pork cutout value was $114.12/cwt FOB the plants, down $2.10 from the week before, but up $26.28 from a year ago. Loin prices were lower this week, hams and bellies higher. This morning's hog carcass price averaged 95.7% of the cutout value.
Hog slaughter this week totaled 2.019 million head, up 1.0% from the week before and down 3.4% compared to the same week last year.
Nearby hog futures were lower this week. The May lean hog futures contract closed at $117.22/cwt, down $3.70 from the previous week. June hog futures ended the week at $122.22/cwt, down $2.30 from the week before. July hogs lost 70 cents this week to close at $121.97/cwt. The August contract ended the week at $121.65/cwt, up $1.20 for the week. October closed at $103.02.
Corn futures ended this week lower than last. The May corn futures contract settled at $4.94/bushel today, down 13 cents from the week before. July corn closed at $4.995, also down 13 cents for the week. September corn ended the week at $4.9625/bushel.