Grimes and Plain Weekly Hog Outlook

CHICAGO - May 11/07 - SNS -- Following is a week ending hog market comment from the University of Missouri - Columbia's Glenn Grimes and Ron Plain.

The April 1 Canada hog inventories continues to show a slow decline in the breeding herd. The breeding herd in Canada April 1 2007 was 1.6 percent below a year earlier, the market herd was down 6.4 percent and the total herd was down 3.1 percent from April 2006.

Manitoba and Saskatchewan continued to show a slow growth in the breeding herd. The combined breeding herd in the US and Canada on March 1 and April 1 was up 0.4 percent this year compared to last year. However, the farrowing intentions for both countries for the 2nd quarter of 2007 is for a decline of about 0.2 percent from a year earlier. We have had only 3 quarters since July, August, and September of 2003 that forrowings in US and Canada has been below 12 months earlier.

The 6.4 percent decline in market hog inventories shows 4 times the decrease in Canada breeding heard and is due to the increased export of feeder pigs to the US. However, the last 6 week data available shows feeder pig imports from Canada about the same as in the same weeks in 2006.

Good progress was made last week in corn planting with a jump from 23 percent planted the week ending April 29 to 53 percent planted the week ending May 6. But there has probably been limited planting this week due to rain.

The average live weight of barrows and gilts in Iowa-Minnesota last week at 267.7 pounds is up 0.2 pounds from a week earlier but still 1.2 pounds below 12 months earlier. The average weights of barrows and gilts in Iowa-Minnesota have averaged a little over 0.8 pounds below a year ago for the 4 weeks ending May 6. This suggests the odds are high that marketing in the Midwest are a little more current this year than in 2006 at this time.

Cash feeder pig prices this week at United Tel-O-auction were $3-8 per cwt higher than 2 weeks earlier. All of the 1270 pigs at United this week were in the 50-60 pound weight groups and sold from $112.50 to 123 per cwt.

Feeder pig prices usually have started the seasonal decline by this date. The marketing date for most of these pigs will be September.

Pork cut out this week on Thursday afternoon at $76.81 per cwt was up $1.67 per cwt from a week earlier. Loins were up $2.75 per cwt at $97.13 per cwt, Boston Butts at $73.97 per cwt were down $1.22 per cwt, Hams were down $2.48 per cwt at $58.33 per cwt, and bellies at $106.58 per cwt were up $7.75 per cwt from a week earlier.

Cash top hog prices this Friday morning were steady to $5.00 per cwt lower compared to seven days earlier. The weighted average carcass price in negotiated trade Friday morning were $1.65 to 3.72 lower compared to a week earlier.

The Friday morning cash top prices for select markets were: Peoria $48 per cwt, St Paul $49 per cwt, and interior Missouri $51.50 per cwt. The weighted average carcass negotiated price by geographic area Friday morning were Western Cornbelt $70.17 per cwt, Easter Cornbelt $69.76 per cwt, Iowa-Minnesota $69.96 per cwt, and Nation $69.95 per cwt.

Slaughter this week under Federal Inspection was estimated at 1934 thousand head down 0.3 percent from a year earlier.

Smith Field Foods announced this week that they were completing the acquisition of premium standard Farms. We do not believe this will have any impact on the hog industry in the Midwest.

Issued by Glenn Grimes and Ron Plain

University of Missouri - Columbia

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