Fall Hog Futures Post Strong Gains

   U.S. pork exports during July totaled 406.568 million pounds, up 2.1 percent compared to a year ago. Our three biggest foreign customers, Japan, Mexico, and Canada, each purchased more U.S. pork than last July. Shipments to Russia and South Korea were down. In total, 22.1 percent of July production was exported. Pork imports during July were up 11.7 percent to 77.142 million pounds. Imports equaled 4.2 percent of U.S. production. During the first seven months of 2013, pork exports were down 9.2 percent and pork imports were up 5.7 percent.
   July feeder pig imports were down 7.8 percent and other hog imports were down 6.4 percent.
   Testing data from the National Animal Health Laboratory Network says that as of August 25, the Porcine Epidemic Diarrhea virus has been confirmed on 553 farms in 17 states. This is an increase of 26 farms from the week before.
   Today’s economic news was mixed. The unemployment rate declined to 7.3 percent in August, but the number of jobs added last month was smaller than expected.
   As of September 1, 56 percent of corn acres were rated in good or excellent condition. That is down 3 points from the week before, but up 34 percentage points from a year ago.
   The national average negotiated carcass price for direct delivered hogs on the morning report today was $86.60/cwt, up 5 cents from last Friday. The eastern corn belt had a morning price average of $84.78/cwt. Neither the western corn belt nor Iowa-Minnesota had enough early morning sales for a price quote. Peoria had a top live price this morning of $58/cwt. Zumbrota, MN topped out at $60/cwt. The top price for interior Missouri live hogs Friday was $61.50/cwt, down $4.50 from the previous Friday.
   Friday morning’s pork cutout value based on mandatory price reporting was $94.94/cwt FOB plants, down 36 cents from the week before, but up $16.38 from a year ago. Loin, butt and ham prices were lower this week, but bellies were slightly higher. The average hog carcass price is 91.2 percent of the calculated pork cutout value.
   Hog slaughter this week totaled 1.97 million head, down 10.9 percent from the week before (due to Monday’s holiday) and down 4.7 percent compared to the same week last year. This was the seventh consecutive week with hog slaughter lower than expected based on the June pig report. The average barrow and gilt live weight in Iowa-Minnesota last week was 270.2 pounds, down 1.4 pounds from a week earlier, but up 2.0 pounds from a year ago. Slaughter weights have been above year-ago for 22 consecutive weeks.
   Hog futures posted strong gains for the second week in a row. The October lean hog futures contract settled at $90.90/cwt today, up $3.28 from the previous Friday. December hog futures ended the week at $87.00/cwt, up $2.25 from the week before. February hogs closed the week at $88.25/cwt.
   September corn futures ended the week at $4.915/bushel, down 3.5 cents for the week. ∆

DR. RON PLAIN AND DR. SCOTT BROWN: Agricultural Economists, University of Missouri