More pork continued to move into storage during April, according to USDA's latest Cold Storage report. In fact, the 659.532 million pounds of pork in freezers at the end of April was the most since April 30, 2008.
Abundant hog slaughter and the continued run of heavy market weights produced more pork than expected. Exports have performed well, but are down a bit from 2011's record pace.
China and South Korea are two markets that are buying less U.S. pork. South Korea's purchases are running 27 percent short of last year's level. Of course purchases in 2011 were double the "normal" rate as the South Korean government attempted to meet pork demand following a 30 percent reduction in the country's swine herd due to a foot-and-mouth disease outbreak. Today, South Korea is rebuilding its swine herd and producing more of its own pork.
According to Tuesday's Cold Storage Report, frozen pork supplies increased from March to April, showing an 8 percent gain as of April 30. Total frozen pork supplies tallied 20 percent higher than for the same period a year ago. Pork belly stocks were 13 percent higher than in March and 41 percent higher compared to April 2011 levels.
"It used to be that high cold storage pork stocks was negative for the market," says Ron Plain, University of Missouri agricultural economist. "In recent years, there has been a positive correlation between stocks of frozen pork and exports."
He points to the amount of pork in cold storage on April 30, 2008, which set a record at 663.443 million pounds. The amount of pork exported in May 2008, 480.809 million pounds also was a record. "I would say the big jump in pork stocks is an indication that pork exports will continue strong in the second quarter," Plain adds.
The U.S. Meat Export Federation looks for the export market this year to be down a bit but nearly equal year-ago levels.
Barrow and gilt market hog weights are setting records, and there's little indication they will let up. Carcass weights are regularly running between 208 and 210 pounds. The question surrounding slaughter numbers is wether the mild winter and spring temperatures had hogs gaining fast enough that it pulled marketings ahead.
Looking at beef, total stocks in freezers were up 3 percent compared to March supplies, and 17 percent higher than last year.
Add the two together and total meat supplies in freezers were up 5 percent from March, and up 19 percent from April 30, 2011.
Poultry supplies grew on the month as well, showing a 10 percent gain from March to April 30. However, poultry stocks in freezers are 6 percent lower than on April 30, 2011. Specifically, chicken supplies are 18 percent lower than a year ago.
Recent foodservice reports suggest that high-priced beef is being substituted on menus, and it's working to the benefit of chicken.