USDA’s May Hogs and Pigs report was more bullish than the futures market has been, but the trade continues to pay little attention to the monthly reports, say Glenn Grimes and Ron Plain, University of Missouri agricultural economists.

Grimes and Plain also believe the monthly reports are somehow missing a lot of hogs. For example, the April pig crop was only 1 percent larger than last April, which would be unusually small growth considering the profitability of 2000 and 2001.

Hog slaughter during the last eight weeks has been more than 2 percent higher than the monthly surveys would suggest. Based on the November monthly report, May 2002 hog slaughter should have about equaled May 2001. But, daily slaughter was up 4.3 percent, say Grimes and Plain.

Some have speculated that May’s weather kept pigs growing at a record pace, keeping marketings ultra current.

The December 2001 pig crop at 102.6 percent of December 2000, implies that June 2002 slaughter will be nearly 3 percent larger than June 2001. We’ll have to see.

Increased Canadian live hog imports can be expected to boost slaughter by 0.5 percent to 0.8 percent vs. June 2001. The Missouri economists don’t expect June live-hog prices to peak within $17 of last year’s June top.

The January pig crop, at 104.1 percent of January 2001, implies that July hog slaughter will exceed July 2001 by about 5 percent. Expect that kind of an increase to drop live-hog prices in the low $30s, say Grimes and Plain.

First-quarter 2002 pig crop indicates third-quarter hog slaughter will exceed July-September 2001 by about 3 percent. Without a demand boost, this means live-hog prices will likely remain in the low $30s, say the Missouri economists.

Sows and gilts bred during the first quarter are 1.1 percent greater than January-March 2001, according to these USDA reports. If that’s correct, then fourth-quarter hog runs should be below the nation’s slaughter capacity. However, if weights continue to run 3 pounds heavier than last year, hog slaughter continues to exceed reported levels, and meat demand remains, then the fall price low could be well short of $20 per hundredweight.