Grimes and Plain Weekly Hog Outlook

CHICAGO - Aug 1/08 - SNS -- Following is a week ending hog market comment from the University of Missouri - Columbia's Glenn Grimes and Ron Plain.

Demand for pork at the consumer level for January-June was down 2.3 percent from a year earlier. In fact, all meats lost demand during the first six months of 2008 from a year earlier. Pork showed the smallest loss. Beef was down 4.7 percent, broilers were down 5.5 percent and turkey was down 5.1 percent.

The good news continues to come from the live hog demand side which showed a 8.2 percent growth in January-June compared to the same period in 2007. Pork exports get most of the credit for the strong live hog demand. Population growth in the U.S. contributed some to the live hog demand growth.

Pork product value has shown strong growth during July. On July first pork product cutout per cwt of carcass was $78.81 per cwt. On Thursday July 31 the cutout had grown to $88.23 per cwt. This strength in pork cutout has permitted packers to increase prices from $70.05 for negotiated carcass price on July 1 to $79.01 per cwt on July 31. Or a live price equivalent of $62.42 per cwt. With pork production up 7 percent in July, this level of hog prices certainly reflects the strong live hog demand.

Barrow and gilt weights live in Iowa-Minnesota at 259.3 pounds per head for the week ending July 26 down 0.3 pound from a week earlier and down 2.4 pounds from the same week in 2007. The average carcass weight under Federal Inspection for the four week period ending July 12 was 0.8 percent below a year earlier. There is no question, hog producers are responding to the high feed prices by marketing hogs at a little lighter weights.

The cutout per cwt of carcass this Thursday afternoon at $88.23 per cwt was up $2.76 per cwt from a week earlier. Loins at $101.38 were up $0.92 per cwt, Boston butts at $92.35 per cwt were up $1.70 per cwt, hams at $89.31 per cwt were up $1.25 per cwt, and bellies at $99.49 per cwt were up $11.89 per cwt from seven days earlier.

Top live high prices this Friday morning were $1.00 lower to $1.25 per cwt higher compared to a week earlier. Weighted average carcass prices for negotiated hogs were $0.41 to 2.33 per cwt higher compared to last week.

The prices live for select markets this Friday morning were: Peoria $51 per cwt, Zumbrota, Minnesota, $57 per cwt, and interior Missouri $55.75 per cwt.

The weighted average negotiated carcass prices by area were: western Cornbelt $79.77per cwt, eastern Cornbelt $79.10 per cwt, Iowa-Minnesota $79.54 per cwt, and nation $79.34 per cwt.

Slaughter this week under Federal Inspection was estimated at 2091 thousand head, up 6 percent from a year earlier.

Cash feeder pig prices at United Tel-O-Auction this week were basically steady with two weeks ago .The prices by weight groups were: 40-50 pounds $54.50 and 50-60 pounds $40-60 per cwt.

Issued by Glenn Grimes and Ron Plain

University of Missouri - Columbia

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