Economists Forecast Hog Prices Following June USDA Quarterly Report
It’s been quite a year for price versus slaughter relationships, said Kevin Grier of Kevin Grier Market Analysis and Consulting during the June 24 announcement of the June Quarterly Hogs and Pigs Report in a teleconference funded by the Pork Checkoff.
“As I admitted, for most of 2021, I feel rudderless completely in terms of pricing,” Grier said. “This U.S. market has been through the roof.”
Three agricultural economists shared their forecasted prices for the next several quarters.
Using the CME Lean Hog Index Equivalent, Grier quoted:
• third quarter of 2021 at $90 to $95 per cwt.
• fourth quarter at $85
• first quarter of 2022 at $75-80
Lee Schulz, economist at Iowa State University, used the Iowa-Minnesota Producers Sold All Purchase Types to quote his prices. He forecast:
• third quarter of 2021 at $92 per cwt.
• fourth quarter at $78
• first quarter of 2022 at $79
• second quarter at $87
“So far that would give 2021 an average of $90 per cwt. That's the highest since 2014, which averaged $101 on a cash basis. That would be the second highest price in my data series that goes back to 2002 with the LMR (livestock mandatory reporting) data,” Schulz said.
Tyler Cozzens of the Livestock Marketing Information Center said he used the National Weighted Average Base Carcass Price. He forecast:
• third quarter of 2021 at $92 to $97 per cwt.
• fourth quarter at $79 to $84
• first quarter of 2022 at $76 to $82
• second quarter at $84 to $91
• third quarter at $82 to $90
• fourth quarter at $72 to $81
Cozzens forecasts the 2021 annual average at $86 to $92, he said, and the 2022 annual average at $77 to $82.
“To add a little more context to this, those third and fourth quarters of 2021 are up 63% and 19% respectively,” Cozzens said. “I do have some slowing in the 2022 prices, those are down about 8% from an annual basis.”
Watch the discussion here.
More from Farm Journal's PORK:
Why USDA's June Hogs and Pigs Lighter Litter Numbers Could Ease Slaughter Concerns in Q4
Lower Pig Crop and Farrowing Intentions Support Higher Prices
