Bear spreading was the rule of the day in lean hog futures trading following Friday’s release from the USDA of its Quarterly Hogs and Pigs report.
The report showed more pigs were being saved per litter and that some gilts that might have gone for breeding could instead be fed for slaughter. Negative margins have burdened the US hog industry this year, so the higher sow productivity allowed producers to cut back – a little.
The industry still is finding its way in the wake of California’s Proposition 12, which dictated some hog-rearing practices for the pork sold in the state.
The US inventory of all hogs and pigs on Dec. 1 was about 75 million head, according to the USDA report.
That was up slightly from Dec. 1, 2022, but down slightly from Sep. 1, 2023. Breeding inventory, at about 6 million head, was down about 3% from last year, and down about 3% from the previous quarter.
Market hog inventory, at 69.0 million head, was up slightly from last year, but down slightly from last quarter. The September-November 2023 pig crop, at 34.6 million head, was down slightly from 2022.
Sows farrowing during this period totaled 2.97 million head, down about 4% from 2022. The sows farrowed during this quarter represented 48% of the breeding herd. The average pigs saved per litter was 11.66 for the September-November period, compared with 11.22 last year.
TOTAL NEAR STEADY
All hogs and pigs on US soil Dec. 1 were 74.971 million head, up 15,000, or 0.02%, from 74.956 million a year earlier but down 352,000. Or 0.47%, from 75.323 million in the previous quarter’s report.
Of that, 5.999 million head were kept for breeding, down 205,000, or 3.30%, from 6.204 million a year earlier and down 180,000, or 2.91%, from 6.179 million in the previous quarter.
Another 68.973 million head were classed as market hogs, up 221,000, or 0.32%, from 68.752 million a year earlier but down 171,000, or 0.25%, from 69.144 million in the previous quarter.
MARKET HOGS SHOW HEAVIER WEIGHTS
The inventory of market hogs was biased toward heavier weights, showing more hogs were coming due for slaughter in coming weeks.
About 21.681 million head weighed less than 50 pounds on Dec. 1, down 107,000, or 0.49%, from 21.788 million a year earlier.
Another 19.039 million head weighed from 50 to 119 pounds, down 95,000, or 0.50%, from 19.134 million head last year.
A total of 14.908 million head weighed 120 to 179 pounds, up 107,000, or 0.72%, from 14.801 million a year earlier.
Lastly, hogs weighing 180 pounds or more on Dec. 1 totaled 13.344 million head, up 315,000, or 2.42%, from 13.029 million a year earlier.
CATTLE, BEEF RECAP
The USDA reported formula and contract base prices for live FOB steers and heifers this week ranged from $171.19 per cwt to $173.29, compared with last week’s range of $163.80 to $171.51 per cwt. FOB dressed steers, and heifers went for $267.96 per cwt to $271.38, compared with $266.16 to $271.15.
The USDA choice cutout Wednesday was down $1.83 per cwt at $291.48 while select was off $0.87 at $260.32. The choice/select spread narrowed to $31.16 from $32.12 with 88 loads of fabricated product and 18 loads of trimmings and grinds sold into the spot market.
The USDA said basis bids for corn from feeders in the Southern Plains were unchanged at $1.28 to $1.38 a bushel over the Mar corn contract, which settled at $4.76 1/2 a bushel, down $0.03 3/4.
No delivery intentions were posted for Dec live cattle Wednesday.
The CME Feeder Cattle Index for the seven days ended Tuesday was $220.51 per cwt, down $0.52. This compares with Wednesday’s Jan contract settlement of $224.47, up $0.92.