Most analysts were expecting the hog inventories to be up slightly from a year ago with the evidence that a controlled expansion continues in the industry. Those expectations were more than satisfied as hog numbers started to rise with the report of a 1.9 per cent increase in market hog numbers and slightly more than half of a per cent increase in breeding swine numbers. Nationally there are 64 million head of swine of which 5.8 million head are for breeding and 59 million head destined for market. The table below summarizes the report of swine inventories nationally and in Iowa.

Iowa market swine numbers increased by a considerable 4.6 per cent while the state’s breeding numbers declined by almost 2 per cent. There are now 17.9 million head of market hogs in the state. Importation of feeder pigs from other states continues to increase as Iowa maintains its status as the location with the lowest cost of grow-finish weight gain. The state’s sow inventory continues to decline as the advantages of using resources to grow and finish hogs outweigh those of farrowing sows.

Pork production is expected to up almost 2 per cent during the year. Market hog numbers are up 2 per cent and lean hog carcass weights have been very consistent with those of a year ago. The current inventory of light weight market hogs will result in a notable increase in pork supplies during the late spring and summer months. Farrowing intentions are down for the second and third quarters of this year. So while the number of litters will be down during the middle half of the year, the continued increase in litter size is expected to offset a portion of that decline in farrowings. While in February expectations were that hog prices would be robustly stronger than a year ago, producers may have already seen tight enough margins and a decline in consumer confidence to tail back on their farrowing intentions for the next couple quarters. That may turn out to be adventitious to the market, as futures prices for lean hogs began slide lower throughout March on declining beef prices and softer red meat demand. Table 2 contains a summary of the expected per cent change in pork supplies and the forecasted lean hog price in the next four quarters. Compared to the forecasted prices from the ISU forecasting model the futures market was perhaps a little bearish for the rest of the year.

Further Reading

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You can view the USDA Quarterly Hogs and Pigs report by clicking here.