Only modest growth was reported in USDA's March Hogs & Pigs Report. (See "USDA's Quarterly Hogs and Pigs Report Shows Modest Growth.")
Inventories for all hogs and pigs, the breeding herd and market hogs are all up a modest 1 percent from March 2006. Farrowing intentions are generally holding steady, (see table below). Except for the market-hog weight group of 180-pounds and over, which is up 4 percent from March 2006, the other weight categories are unchanged or only 1 percent higher than year-ago levels.
Farrowings and Farrowing Intentions
2007 as % of 2006
* Producer-reported intentions
"Given the stretch of profits that we've seen for pork producers," says James Minert, livestock-marketing specialist with Kansas State University, "corn prices have created concern and is the reason why we haven't seen much growth."
While all eyes are on the corn market, the pork industry's structure prevents much fluctuation in numbers. "There's an incentive with today's industry, debt structure and production approach, to run facilities at or near capacity. We're not likely to see much decline in numbers," says Darrell Mark, livestock-market specialist, University of Nebraska.
"We may see some smaller producers get out, but anyone with any size who gets out will likely sell the facilities to someone who will put hogs back in them," says Dan Vaught, analyst with A.G. Edwards, St. Louis.
Citing the 15 percent increase in corn acreage intentions, also reported by USDA on Friday, Minert says 40 percent of that increase is outside of the top 10 corn-producing states, and is set for the Southeastern United States and the Southern plains. He looks for similar growth in soybean acreage for those areas.
"Those increases are positioned well to support hogs in the Southeast," says Vaught. "It will support farrowing and farrowing intentions later on."