USDA’s monthly supply and demand report made few changes to the corn and soybean projections for the coming year, though corn and soybean crop conditions have taken a turn for the worse in the last couple of weeks. As of last Monday’s Crop Progress report both crops were below the 10-year average for good/excellent ratings. Current mid-point price projections for the 2012/13 marketing year are $4.60 per bushel for corn and $350 per ton for soybean meal. Though this implies a higher meal/corn price ratio than this year, it is still low by historical standards as the expected 2011/12 meal/corn price ratio is the lowest since 1984/85.

Pork exports in April were back to above year ago levels after dipping slightly below in March. Since November 2010 monthly pork exports have surpassed year ago levels 17 out of 18 months. Exports to mainland China were at 65.5 million pounds in April, the ninth consecutive month with more than 50 million pounds of shipments. Except for five months in early 2008, the 50 million pound monthly export level had never been reached before the current string began. Pork supplies for the domestic market (production adjusted for net trade) are 0.5% lower than year ago for the first four months of 2012.

The pork retail price declined in May for the fourth consecutive month. The May price fell below the year ago level by 2.2%, the first time pork retail prices have been below year ago since March 2010. The pork/choice beef retail price ratio is at its lowest level since May 2010 (excluding January 2012, when it was at a similar level as May) and the pork/broiler composite retail price ratio is at its lowest level since December 2010.

USDA’s Thursday afternoon calculated cutout value was up sharply to $91.58/cwt, up $7.72 from the previous week, but $1.33 lower than on this week last year. Prices for all cuts were improved relative to last week, with rib values gaining the most, followed by hams and bellies.

The national average negotiated carcass price for direct delivered hogs on the morning report today was $94.25/cwt, up $6.74 from last Friday. The eastern corn belt averaged $92.41/cwt this morning. The quote for Iowa-Minnesota was $99.73/cwt. The western corn belt also had an average of $99.73/cwt on the morning report. Peoria had a live top today of $62/cwt while Zumbrota had a live top today of $63/cwt. The top for interior Missouri live hogs Friday was $63.75/cwt, unchanged from the previous Friday.

Hog slaughter totaled 1.957 million head for the week was down 2.3% from the week before and down 1.0% compared to the same week last year. Barrow and gilt carcass weights for the week ending June 2 remained at 204 pounds, same as the week before, but up 1 pound from a year ago. The average barrow and gilt live weight in Iowa-Minnesota last week was 274.4 pounds, down 0.5 pounds from a week earlier, up 5.8 pounds from a year ago.

Friday’s close for the July lean hog futures contract was $93.03/cwt, down slightly from the previous Friday. The August hog futures contract settled at $91.20/cwt, down $1.25 for the week. October ended the week at $81.05. December settled at $77.85/cwt.