USDA's June hogs and pigs report forecast farrowings during the next six months to be down 1.9%. If pigs per litter continue the recent trend of increasing 2% per year, then the pig crop should be close to a year-earlier and thus, hog slaughter during the coming winter and spring should also be close to the level of this past December-May. USDA's market hog inventory in the hogs and pigs report indicated June barrow and gilt slaughter would be down 0.5% and July slaughter up 3% or so. June slaughter was down roughly 1.5% compared to a year earlier. Will July slaughter also come in under USDA's estimate?
The big farm news this week was Thursday's crop reports. USDA said 92.282 million acres are planted to corn, up 4.09 million from last year and 1.515 million acres above the average of pre-release trade estimates. They forecast harvested corn acres would be 3.44 million higher than last fall. USDA also said corn stocks on June 1 totaled 3.67 billion bushels, 370 million bushels above trade estimates. That combination forced corn futures down the limit on Thursday. For the week, the July corn contract lost 29 cents to close Friday at $6.41 per bushel. December corn ended the week at $5.9775 per bushel, down 34 cents from the previous Friday. Soybean meal futures were a bit higher this week.
Hog prices went downhill this week. Carcass prices exceeded a dollar per pound early in the week. The national average negotiated carcass price for direct delivered hogs on the morning report today was $94.81/cwt, down $5.96 from last Friday. Most packers started today with their slaughter needs lined up ahead of the 3-day weekend as neither Iowa-Minnesota, nor the western corn belt, nor the eastern corn belt had enough early hog sales this morning for a market report. Friday's top live hog price at Peoria was $66/cwt. Zumbrota's top was $68/cwt. The top for interior Missouri hogs this morning was $70.50/cwt, 75 cents higher than the previous Friday.
The pork cutout value dropped following three up weeks. USDA's Thursday afternoon calculated pork cutout value was $96.12/cwt, down $3.15 from the previous Thursday. Loins, hams, and butts were all lower. Bellies were higher. Packer margins continue to be tight. This morning's national average hog carcass price equaled 98.6% of the pork cutout value.
Hog slaughter totaled 1.945 million head this week, up 0.5% from last week, but 1.0% compared to the same week last year. Barrow and gilt carcass weights for the week ending June 18 averaged 201 pounds, down 1 pound from a week earlier, but 1 pound heavier than a year ago. Iowa-Minnesota live weights for barrows and gilts last week averaged 268.2 pounds, down 0.1 pound from the week before and down 1.5 pounds compared to the same week last year.
The July lean hog futures contract ended the week at $95.50/cwt, down 50 cents from the previous Friday. The August contract settled Friday at $93.15/cwt, down $2.05 for the week.