While the barbeque season is beginning, so has the seasonal decline in hog slaughter. Chuck Levitt, an analyst with Alaron Trading, says those factors will help strengthen the market in upcoming weeks.
Still, he doesn't expect prices to be as strong as last summer's. In the May-to-July period last year, carcass prices averaged around 80 cents a pound. This year's summer price could drop and hold in the mid-70 cents, he says.
Producers should continue to make money, especially with low feed costs, Levitt says. However, starting in August and moving into the fourth quarter hog prices should drop a bit more from summer's levels.
Overall, Levitt expects the U.S. breeding herd to continue its slow expansion, and both U.S. and Canadian producers will be marketing more hogs into 2006.