Although the trade was expecting a slight increase, USDA's January supply and demand report (WASDE) trimmed the size of the 2013 corn crop by 64 million bushels to 13.925 billion. They increased the number of acres harvested by 0.5 million, but reduced the average yield from 160.4 bushels per acre to 158.8 bu/ac. They are still predicting a marketing year average price close to $4.40/bu. They increased the estimated size of the 2013 soybean harvest by 31 million bushels to 3.289 billion.
USDA decreased their forecast of 2014 pork production by 1.4 percent to 23.58 billion pounds and raised their predicted live hog price by $1 to $62/cwt. USDA is now predicting that in 2014 the U.S. will produce 1.7 percent more pork, 3.0 percent more chicken, 1.5 percent more turkey, but 5.4 percent less beef than in 2013. Total red meat and poultry production is expected to be up 0.2 percent.
Retail meat demand was up 3.2 percent in November with pork demand up 5.9 percent, beef up 0.8 percent, broiler up 2.1 percent, and turkey up 14.2 percent. Export demand for pork and beef were higher in November, but export demand for broiler and turkey were lower.
The U.S. economy added 74,000 jobs in December, the fewest for any month since May 2011. That is not encouraging news for domestic meat demand.
Friday morning's pork cutout value based on mandatory price reporting was $82.61/cwt FOB plants, down 40 cents from the week before and down 86 cents from a year ago. Wholesale belly prices this morning were lower than wholesale loins for the first time since June 15, 2012.
Hog prices ended the week steady. The national average negotiated carcass price for direct delivered hogs on the morning report today was $76.46/cwt, up 19 cents from last Friday, but down $3.16 from a year ago. There was no price quote for the eastern corn belt. This morning the western corn belt averaged $76.31/cwt and Iowa Minnesota averaged $76.12/cwt. Peoria had a live price top this morning of $53/cwt. Zumbrota, MN also topped at $53/cwt. The top price for interior Missouri live hogs Friday was $56.50/cwt, up $1.50 from last Friday. This morning's hog carcass price averaged 92.6 percent of the cutout value.
Hog slaughter this week totaled 2.102 million head, up 5.6 percent from the week before (New Year's week), but down 7.3 percent compared to the same week last year due to cold and snow at the start of this week.
The average live weight of barrows and gilts in Iowa-Minnesota last week was 282.9 pounds, up 0.6 pound from a week earlier and up 6.6 pounds from a year ago.
The February lean hog futures contract settled at $85.82/cwt today, down 85 cents from the previous Friday. April hog futures ended the week at $91.00/cwt, down 57 cents from the week before. May hogs gained 17 cents to close at $98.87. The June contract ended the week at $100.90/cwt. July closed at $99.65/cwt.
March corn futures ended the week at $4.3275 per bushel, up 9 cents from the week before.