March Surpassed Old Hog Market Profit Record
Iowa State University estimates the typical Iowa market hog was sold at a profit of $92.35 per head in March. That is a new monthly record surpassing the old profit record of $64.68/head for hogs sold in September 1975. Cost of production for hogs marketed in March was estimated at $56.19/cwt live. March was the 14th consecutive month with lower cost of production.
USDA says there were 575.223 million pounds of pork in cold storage at the end of March. That was 12.1 percent less than the month before and 11.2 percent less than a year ago. The large decline in pork stocks is surprising, given the run up in pork prices expected this summer. Stocks of frozen bellies, however, were up 54.9 percent from a year ago.
Hog weights keep setting records. The average live weight of barrows and gilts in Iowa-Minnesota last week, 286.4 pounds, was record high for the fifth consecutive week. Last week’s average was up 0.7 pound from a week earlier and up 9.3 pounds from a year ago.
Hog slaughter this week totaled 1.999 million head, down 0.1 percent from the week before and down 6.8 percent compared to the same week last year. Year-to-date hog slaughter is down 4.3 percent, but because of heavier weights, pork production is down only 1.3 percent.
Friday morning’s pork cutout value was $116.22/cwt FOB the plants, down $6.08 from the week before, but up $29.07 from a year ago. This morning's hog carcass price averaged 94.0 percent of the cutout value.
Cash hog prices this week were lower for the third consecutive week. The national average negotiated carcass price for direct delivered hogs on the morning report today was $109.24/cwt, down $1.85 from last Friday, but up $30.86 from a year ago. The eastern corn belt reported a morning average of $109.15/cwt. The western corn belt averaged $110.20. There was no Iowa-Minnesota hog price quote this morning. Peoria had a top live price today of $80/cwt as did Zumbrota, MN. The top price Friday for interior Missouri live hogs was also $80/cwt which was down $3.75 from the previous Friday.
Hog futures were lower this week. The May lean hog futures contract closed at $120.92/cwt today. That is down $2.58 from the previous week. June hog futures ended the week at $124.52/cwt, down 30 cents from the week before. July hogs lost 40 cents this week to close at $122.67/cwt. The August contract ended the week at $120.45/cwt, down $1.45 for the week.
Corn futures and soybean meal futures ended the week higher than they started. The May corn futures contract settled at $5.07/bushel today, up 12 cents from the week before. July corn settled at $5.13 today, also up 12 cents for the week. September corn ended the week at $5.09/bushel.
The May soybean meal futures contract gained $2.30 this week to close at $490.60/ton today. July soybean meal futures settled at $481.40/ton.∆
DR. RON PLAIN AND DR. SCOTT BROWN: Agricultural Economists, University of Missouri