The latest US Department of Agriculture Hogs and Pigs report has shown a decrease in hog inventories across the board.

Sask Pork industry and policy analyst Mark Ferguson says the report contained pretty good news for the North American pork industry.

Mark Ferguson-Saskatchewan Pork Development Board

As of 1 March the total pig inventory in the US was down by 3.6 per cent and that's a fairly big decline for this industry.

At the same time the breeding stock inventory declined by three per cent.

Basically all categories of animals are down by a few percent so there's going to be fewer animals available for slaughter in the coming months and slaughter plants that want to keep running at full capacity are going to have to bid for hogs so that's great news from a farmer's perspective.

In the March to May period farrowings were down by about five percent which is a fairly large decline, however they're showing an increase in litter size of 2.1 per cent so that mitigates some of the reduction in sows bred.

In terms of Canada, Statistics Canada won't be releasing their 1 July inventory estimates until sometime in August but their last few reports have shown small quarterly reductions in breeding stock and total inventories of around one to two percent per quarter.

The Canadian breeding herd now sits at just under 1.3 million animals and that's down 17 per cent from 2007.

Mr Ferguson says the reduction in the breeding herd in Canada and the US has had an effect on pricing.

He says, in combination with a strong demand for pork, we've seen pork in cold storage decline 23 per cent year over year and the cutout price in the US is also strong so there are generally good returns for packers which is translating into good prices for producers.