Hog Supplies Tighten as Prices Ease, Production Holds Steady

The USDA’s latest Hogs and Pigs Report caught some analysts off guard. Inventories came in lower than expected, signaling tighter supplies ahead, even as producers return to profitability this year.

NASHVILLE, Tenn. (RFD-TV) — Hog prices are easing slightly with Western Cornbelt caracasses down from the previous week. Pork producer profits have narrowed to about $64 per head, but margins remain in the black, and packers continue to run near full capacity, with utilization around 97 percent. Even with lower cutout values and feed costs, analysts say demand for pork remains steady and supplies are strong.

The latest Hogs and Pigs Report from the U.S. Department of Agriculture (USDA) caught some analysts off guard. Inventories came in lower than expected, signaling tighter supplies ahead, even as producers return to profitability this year.

“That gave us inventories as of September 1 and then helped us kind of project those numbers six months to a year ahead, as we kind of look at those slaughter supplies and kind of anticipate what those numbers are,’ said xxx. “And to summarize that report, you know, I would put it in the category of a bit of a shocker, because not only did we see numbers below a year ago, which was a little bit of a surprise, but compared to pre-report expectations, as there’s about seven analysts that were asked about, you know, what they expected the numbers to be, and USDA came in much lower than those numbers.”

That surprise has ripple effects across the market, with forecasts shifting as analysts weigh the latest numbers against producer demand.

Related Stories
For farm country, that caution can mean higher costs, slower service, and less local investment.
CWD is an infectious, degenerative disease of cervids that causes brain cells to die, ultimately leading to the death of the affected animal.
Dr. Derrell Peel says long-term price relief will depend more on rebuilding the U.S. cattle herd than increasing imports.
Ethanol production climbed to a four-week high while inventories fell to their lowest level since early October, according to energy data analyzed by the RFA.

LATEST STORIES BY THIS AUTHOR:

HTS Commodities broker Lewis Williamson joins us to break down the latest USDA Crop Progress Report and how weather and global supply chain issues could influence planting conditions moving forward.
Purdue University’s Dr. Michael Langemeier joins us to break down the latest read on farmer sentiment in the April Ag Economy Barometer, and growing concerns about the impact of global conflict on farm inputs and income.
Federal officials are signaling a more aggressive push on beef packer concentration, but any direct market impact will depend on what the investigation actually finds.
Higher freight rates and potential service disruptions are key concerns for agriculture, which relies heavily on rail to move commodities.
Pseudorabies case confirmed in Iowa herd prompts heightened biosecurity measures as U.S. swine producers work to prevent spread and protect herd health.
Wyoming cowboy and Dusty Vaquero Days founder J.B. Zielke joins us to preview his upcoming event in Gillette and to highlight the festival’s celebration of cowboy culture through music and community events.