Retail red meat prices were at record levels this fall. Grocery store pork prices were record high in September ($3.561/lb). Retail beef was record high in October ($4.933/lb). These high prices were driven by tight supplies more than strong demand. The U.S. pork supply in 2011 is only 45.9 pounds per American, down 1.8 pounds from last year and the lowest since 1976. Per capita red meat and poultry supply is down 3.2 pounds from 2010 and the lowest since 1991.

The unemployment rate dipped to 8.6% in November. The employment report was mixed news as employers added 120,000 jobs during November, but 315,000 people gave up looking for work. If the economy is able to sustain growth and pull the unemployment level down, meat demand will almost certainly improve, pushing livestock prices still higher.

This week hog prices rose for the second consecutive week. The national average negotiated carcass price for direct delivered hogs on the morning report today was $82.44/cwt, up 89 cents from last Friday. The Friday morning average price for both the western corn belt and Iowa-Minnesota was $83.94/cwt. The eastern corn belt averaged $81.55/cwt. Friday's top live hog price at Peoria was $59/cwt. Zumbrota's top was also $59/cwt. The top for interior Missouri live hogs was $60/cwt, up $1.50 from the previous Friday.

USDA's Thursday afternoon calculated pork cutout value was $89.30/cwt, down 9 cents from the previous Thursday. Loins, hams and butts were lower. Bellies held steady.

These are remarkably high prices for the start of December. A year ago the Peoria hog price was $46.50/cwt, the national carcass average price was $65.19/cwt, and the pork cutout was $77.89/cwt.

Hog slaughter totaled 2.361 million head this week, up 14.2% from the week before, which was light because of Thanksgiving, and up 1.5% compared to the same week last year. Barrow and gilt carcass weights for the week ending November 19 averaged 205 pounds, down 1 pound from the week before and the same as a year ago. Iowa-Minnesota live weights for barrows and gilts last week averaged 276 pounds, up 1 pound from the week before and up 1 pound compared to last year.

Today's close for the December lean hog futures contract, $86.05/cwt, was down $2.05 from last Friday. The February lean hog futures contract settled at $89.22/cwt, down $2.58 from the previous Friday. April lost $2.23 this week to settle at $92.02/cwt. June hogs ended the week at $99.32/cwt.

China is expected to import a record amount of pork this year. Through September, U.S. pork exports to China are up 376% compared to the same period last year and are less than 4% below the record pace of 2008.