USDA’s quarterly inventory of the U.S. hog herd is not bullish, but it’s also not highly bearish. Still, with most categories coming in above the average pre-report trade guess, the report definitely gets a negative read.
So far, domestic and export demand has been chewing through the slightly bigger-than-expected supply of market hogs. Based on the report numbers, strong demand will need to continue.
Despite a very hot summer, U.S. hog producers farrowed just 1% fewer sows than year-ago, but continued increases in efficiency pushed the June through August pig crop 1% above last year. At 10.03 pigs per litter this summer, litter size matched the previous quarter -- only the second time in history above 10 pigs per litter.
Looking forward, hog producers plan to reduce farrowings slightly through fall and winter, but not enough to counter what is likely to be a continued rise in the number of pigs per litter over year-ago.
We’ve got to wonder... What would hog inventory numbers look like if corn prices had topped at $6.00? Corn prices made record all-time highs at $7.99 3/4 in the quarter representing this hog inventory data and yet producers still found a way to grow the herd.
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||
