USDA's Foreign Agricultural Service expects U.S. pork exports to be up 5.7 percent this year, according to Ron Plain and Glenn Grimes, agricultural economists, University of Missouri.
The United States is the world's largest pork exporter. FAS is forecasting pork export increases of less than 1 percent for both the European Union and Canada, the world's second and third largest pork exporters. The number four exporter, Brazil, is expected to increase its pork exports by 12 percent.
"There are two major pork producing regions in the world: China and everybody else," say Plain and Grimes. "China is expected to account for 49.4 percent of 2010 world pork production."
FAS is forecasting world pork production will be up 1.7 percent this year thanks to a projected 3.5 percent increase in China. USDA is forecasting 2010 pork production outside China will be down 0.2 percent compared to last year.
The FAS expects the amount of pork moving in international trade will be up 2 percent to 4 percent this year. They are forecasting increased pork imports by the United States’ top three foreign customers - Japan, Mexico and Canada.
"The financial crisis in Europe has caused the dollar to strengthen rapidly in recent days making exporting U.S. pork more of a challenge," say the economists.
USDA's Thursday afternoon calculated pork cutout value was $85.37 per hundredweight, down $2.58 from the previous Thursday and at the lowest level since April 16. Pork cutout has dropped $6.44 since its peak on May 14. A dip in cutout at this time of year is not unusual. The quick spring run up in pork prices often slows retail pork movement in early summer.
The national weighted average carcass price for negotiated hogs Friday morning was $74.11 per hundredweight, $1.14 lower than the previous Friday. Regional average prices on Friday morning were: eastern corn belt $72.74, western corn belt $75.87, and Iowa-Minnesota $75.63 per hundredweight.
The top live hog price Friday at Sioux Falls was $55.50 per hundredweight, down 50 cents from the previous Friday. Peoria topped at $51 on Friday and Zumbrota, MN had a top price of $54. The interior Missouri live top Friday was $55 per hundredweight, 75 cents lower than the previous Friday.
This week's hog slaughter totaled 1.791 million head, down 6.9 percent from the week before, and down 14.4 percent compared to the same week last year. The big drop in slaughter was due to Monday's Memorial Day holiday.
The average carcass weight of barrows and gilts slaughtered the week ending May 22 was 201 pounds, the same as the week before and up 1 pound compared to a year ago. Iowa-Minnesota live weights last week averaged 270.8 pounds, up 0.7 pounds compared to a year earlier.
The June lean hog futures contract ended the week at $79.05 per hundredweight , down $2.80 from the previous Friday. The July contract settled at $79.72, down $2.88 for the week. August closed the week $2.03 lower at $80.77 per hundredweight and October ended the week at $74.07 per hundredweight.
Source: Glenn Grimes and Ron Plain, University of Missouri