Hog Outlook: Retail pork prices down from March 2012

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Retail pork prices in March averaged $3.466 per pound, up 2.5 cents from the month before, but down 2.4 cents compared to March 2012. Bacon prices continue to be strong. The average price of bacon at retail, $4.582/lb, is higher than boneless pork chops, $3.957 per pound.

The average price for 51-52 percent lean hogs in March was $54.28/cwt, down $7.31 from the month before and the lowest for any month since September.

This week USDA's Foreign Ag Service released their latest forecast of world meat production. They are predicting 2013 global pork production will be up 1.8 percent from 2012. Of the top six customers for U.S. pork exports, only Canada is expected to produce less pork this year than last. Pork production is forecast to be up 0.6 percent in Japan, up 3.5 percent in Mexico, up 2.8 percent in China, up 14.2 percent in South Korea, and up 3.6 percent in Russia. Needless to say, this is not positive news for U.S. pork exports. USDA is forecasting a 3.3 percent decline in U.S. pork exports compared to 2012. The U.S. is expected to remain the world's largest pork exporter ahead of the E.U., Canada, and Brazil

Friday morning's pork cutout calculation based on mandatory price reporting was $83.15/cwt FOB the plants, down 83 cents from the week before. Ham and butt prices were higher for the week; belly and loin prices were lower.

The national average negotiated carcass price for direct delivered hogs on the morning report today was $74.20/cwt, down $1.76 from last Friday. The eastern corn belt averaged $73.66/cwt this morning. The western corn belt averaged $77.06/cwt. Iowa-Minnesota did not have enough early day sales for a morning price report. Peoria and Zumbrota each had a top live price this morning of $52/cwt. The top for interior Missouri live hogs Friday was $57.75/cwt, down 75 cents from the previous Friday. The average hog carcass price is 89.2 percent of the calculated cutout value based on mandatory reporting.

Hog slaughter this week totaled 2.139 million head, up 2.7 percent from the week before and up 2.7 percent compared to the same week last year. Since March 1, hog slaughter has been a bit lower than expected based on the March market hog inventory.

The average barrow and gilt live weight in Iowa-Minnesota last week was 276.5 pounds, down 0.7 pound from a week earlier, but up 0.1 pounds from a year ago.

The May lean hog futures contract closed at $87.85/cwt today, up 48 cents from the previous week. June hog futures ended the week 30 cents higher at $90.20/cwt. July hogs settled at $90.27/cwt and August at $90.00/cwt.



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