Retail pork prices in February were the fourth highest ever behind September-November 2010. The average price of pork in grocery stores was $3.283 per pound. That was up 4.2 cents from the month before and up 36.6 cents from February 2010. The farmer’s share of the retail pork price went up in February while the marketing margin declined. The total margin, $2.218 per retail pound, is the tightest since August. The average price for 51-52% lean hogs on a live weight basis was $61.62/cwt, up $6.06 from January, up $12.64 from February 2010, and the highest for any month since May.
The destruction caused by the earthquake and tsunami in Japan were the big market movers this week. Japan is our largest foreign customer for pork exports. Last year 5.7% of U.S. pork production was exported to Japan.
Hog prices dropped early in the week then recovered to end close to last Friday’s level. The national weighted average carcass price for negotiated hogs Friday morning was $79.30/cwt, up 26 cents from the previous Friday. Friday morning’s western corn belt carcass prices averaged $80.63/cwt. Iowa-Minnesota averaged $78.96/cwt. The eastern corn belt averaged $78.74/cwt Friday morning. The top live hog price Friday at Sioux Falls was $57/cwt. Peoria topped out at $56/cwt, Zumbrota at $55. The interior Missouri live top Friday was $58/cwt, down 50 cents from the previous Friday.
USDA’s Thursday afternoon calculated pork cutout value was $92.06/cwt, up 94 cents from the previous Thursday. Loins, bellies and hams were higher this week. Butts were lower. Pork belly prices, $137.33/cwt, are the highest since September.
The average carcass weight of barrows and gilts slaughtered the week ending March 5 was 206 pounds, the same as the previous week and 5 pounds heavier than a year ago. Iowa-Minnesota live weights for barrows and gilts last week averaged 274.3 pounds, up 1.7 pounds from the week before and up 3.8 pounds compared to a year earlier. Hog weights have been above year-ago for the last 25 weeks.
Hog slaughter totaled 2.138 million head this week, down 0.8% from the week before and down 1.3% compared to the same week last year.
The April lean hog futures contract ended the week at $88.32/cwt, up 17 cents from the previous Friday. The May contract ended the week at $98.35/cwt. June hogs settled at $99.82. Earlier this year, we had four contract months above $100.00. For the second week in a row, there are none.
May corn futures ended the week at $6.835 per bushel, up 19 cents from the week before. The July corn contract settled at $6.90/bu. up 19 cents from a week earlier. September settled at $6.37.
USDA will release the results of the March 1 hogs and pigs survey next Friday. I expect both the swine breeding herd and the market hog inventory to be even with a year ago.
Source: Ron Plain, University of Missouri