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USDA’s September Hogs and Pigs report came in bullish, with nearly all numbers coming in at or below industry expectations.

“A lot of us are breathing a sigh of relief after this report,” says Chris Hurt, Purdue University agricultural economist. “The industry will probably still suffer some loses in the fourth quarter, but not nearly as badly as we had feared.”

The total hog inventories came in at 60.2 million hogs, which was up only 1 percent above last year’s levels. The breeding herd was down 2 percent from September 2001 and the market hog inventory was 1 percent above last year. The June-August 2002 pig crop was 2 percent less than both 2001 and 2000.

Sow slaughter remained high and farrowing intentions for the immediate future are down, indicating producers have responded to the threat of a market crash by liquidating the breeding herd.

If this report is correct, liquidations and marketings pulled forward appear to be enough to have avoided a 1998-level price crash. Most analysts now feel that the quarterly average for live hogs will be in the low-$30 per-hundredweight range for the fourth quarter.

There is some concern about the accuracy of the report, as with any report, but Hurt says the 180 pound inventories match the September slaughter numbers closely, which is a good sign as to the accuracy of this report.

“This is remarkable new,” says Ron Plain, University of Missouri agricultural economist. “If this report holds true, August and September have probably been the two lowest months of the year for prices. I’m not sure that’s ever happened before.”