USDA Hogs and Pigs Report
June 1st
(1,000 head)

Expected Farrowing’s down 4% June – August

Pigs per Litter last 3 months 10.95, last year 11. No change.

Last week my son Spencer and I continued to travel the Midwest.

Our Observations

U.S. big place. To date we travelled 6,000 miles (9,500 kilometres); 14 hotels. Context, if you could drive Chicago to Moscow its 5,000 miles. Fact, Spencer got to drive a lot.

Crops

We were in 12 states – saw lots of crop. Wheat harvest underway in Oklahoma – Kansas. Wheat cheaper than corn, wheat now going in feed rations substituting corn. Corn silking in Kansas. Was dry in some areas until big rains end of week, water lying in fields in 5 states. Crops looking good. Was very timely big rain. December corn has gone from $6.28 bushel on June 10 to close Friday at $5.19. Wouldn’t be surprised to see a 4 in front of December soon.

PRRS

PRRS 144 is ripping production base in the Midwest. Up to 25% sow mortality, up to 40 -50% wean to finish deaths. It’s really nasty. It’s a terrible situation for too many producers.

Maybe we are missing something but doesn’t seem much appetite to build new sow barns with 30% increase in building costs, high feed prices, labor issues, and uncertainty of hog market future.

Sow Mortality

Sow Mortality in some systems approaching 20%. Prolapses are a BIG issue. It seems to be tied to the world’s biggest genetic company. They push to blame feed, water, environment etc. etc. etc. Not sure if compensation will be offered to all affected (or just some) similar to the Chlamydia issue. When prolapses is a Genetic issue not sure how there is an easy fix. In meantime producers can continue to suffer or find a genetic alternative.

Hog Weights

We met some on our travels who believe market hog weights will drop into the 260’s this summer unless slaughter really cuts back. The last 5 years the low weights for the year were 277 lbs. in the last week of July or first week of August. Current weights are near 278 lbs. Last week Iowa/Minnesota 6.2 lbs. lower year over year. We expect Pork Cut-outs will recover from $1.10 currently with supply decline from lower slaughter weight and or smaller weekly marketing’s.

Better Pork

As a reader of this commentary you are aware that we believe as an industry to grow demand we need to produce Pork that has better tasting and have positive eating experience. On this trip we found many who tell the same direction needs to be considered. We delivered Genesus Pork to some and delivering to others in the future. No genetic company says they have Pork that tastes like cardboard. So, we have to show the difference. We aren’t afraid. Reviews to date are quite positive. After 20+ years of working to produce better tasting Pork at a competitive cost of production it’s refreshing to see the industry taking notice that there is a difference.

Summary

We believe supply of hogs and or weights could decline significantly in coming weeks. PRRS, construction costs, feed costs, labor issues (lack of) are keeping a lid on herd expansion. The hog price should stay strong in coming months.