Sometimes it pays to look at where we are compared to a year ago.
National Daily Base Lean Hog Price -53-54%
- October 24, 2019_64.50 ¢ per lb.
- Oct 26, 2018_63.72 ¢ per lb.
This past weeks hog slaughter – 2,693,000.
Pork Cold Storage- September 30 up 2% from a year ago
Year to date Sow slaughter on September 30
2018- 2,242 million
2019- 2,235 million
Almost no change
U.S.D.A cash average 40 lb. feeder pigs
More hogs to market (plus 5%) this year compared to last, but hog prices the same, reflecting better pork demand. Pork in Cold Storage and sow slaughter showing almost no year over year difference, while 40 lb. feeder pigs are 10% higher year over year.
Of note- last year feeder pigs went from the $40’s to $70’s by mid-December. We expect a similar scenario this year.
Below is U.S. Direct Feeder Pig Chart
We spent some time last week with a company from China. They have about 60,000 sows currently. Last week they said they were selling market hogs for 43 rmb/kg., which is $2.75 lb. U.S. liveweight. We asked them how high they thought market hog prices could go, they replied, 60 rmb/kg., which is $3.84 U.S. liveweight a lb.
If that happens a 260 lb (120 kg.) hog would fetch $988 U.S.
Hard to believe, but then again no one thought the price would get where it is now.
No doubt you can see why JBS and Tyson decided to pull Ractopamine (paylean) from feed the last two weeks so they could ship to China.
Over the next few months total pork exports from U.S. will set unprecedented volume levels filling the hole cracked by ASF in China, South Korea, Viet Nam and the Philippines.