HOG OUTLOOK October 15, 1996 Approved by the World Agricultural Outlook Board -------------------------------------------------------------------------------- HOG OUTLOOK, a supplement to the Livestock, Dairy, and Poultry Monthly, is published five times a year by the Economic Research Service, U.S. Department of Agriculture, Washington, DC 20005-4788. LDP-H-12. Subscriptions to the printed version of this report are available from the ERS-NASS order desk. Call, toll-free, 1-800-999-6779 and ask for stock #LDP-H, $22/year. A consolidated subscription to all of the livestock, dairy, and poultry reports (34 issues/year) is also available as stock #LDP-A, $66/year. ERS-NASS accepts MasterCard and Visa. -------------------------------------------------------------------------------- Feed costs dropped sharply as the harvest of 1996 crops began. The 1996 corn crop is forecast at 9.0 billion bushels, up 22 percent from last year. Farm corn prices during the 1996/97 marketing year are expected to average $2.80 to $3.20 per bushel, compared with $3.25 in 1995/96. The soybean crop is expected to total 2.346 billion bushels this year. Soybean meal prices (48 percent, Decatur) are expected to average $225 to $245 per ton in the 1996/97 marketing year, compared with $236 in 1995/96. The general economy in 1997 is expected to grow 2.0-2.5 percent, about the same as in 1996. Hogs and Pigs Inventory Declines The September Hogs and Pigs report indicates that producers continued to reduce their herds as feed costs plateaued at a high level in May through August, then dropped sharply in September. However, strong hog prices during the period kept producers' returns well above cash costs, averting a large liquidation of the herds. The September 1 breeding inventory was 2 percent below last year and the market hog inventory was down 4 percent from a year ago. During January-April, producers' returns were lackluster as corn prices were rising amid concern about the 1996 crop because plantings were delayed due to wet weather. Sow slaughter rose in April suggesting that some producers cut back or exited the industry. These may have been high-cost producers with less feed efficiency and/or producers that chose to sell their corn on the cash market rather than feed it to hogs. In April, weekly sow slaughter averaged 13 percent above a year earlier. With the jump in hog prices in May, weekly sow slaughter averaged only 4 percent above 1995. With continued improved returns, weekly sow slaughter in July and August averaged 13 percent below a year earlier, although the June 1 breeding inventory was down 4 percent. As a percentage of total hog slaughter, sow slaughter during July-September was record low. Breeding inventory adjustments among the quarterly reporting States indicated declines in the top seven corn producing States, except Minnesota. In contrast, some States that have large scale operations (Kansas, Missouri, North Carolina, and Oklahoma) generally showed double-digit year-over-year growth in breeding inventories. In the other States (those not separately reported) the breeding inventory rose 28 percent. As of September 1, producers in North Carolina reported intentions to have 495,000 sows farrow in December-February, surpassing the intentions of 460,000 reported in Iowa, the longtime leading hog-producing State. Feed prices began moderating in August, strengthening expectations for lower feed costs in the coming months. With 4 months of returns over breakeven (cash costs) exceeding $10 per cwt marketed and expectations for sharply lower feed costs, producers as of September 1 intend to have nearly the same number of sows farrow during September-November as a year earlier, compared with 3 percent fewer reported in June. Intentions for December 1996-February 1997 were to have 1 percent fewer sows farrow than in the same period a year earlier. Pork Production To Decline in 1996 The lower September 1 inventory of market hogs weighing 60-179 pounds and the March-May pig crop indicate that pork production will remain below a year earlier in the fourth quarter. The March-May pig crop has been revised downward by 398,000 head from the number reported in June. Because hog prices will likely be relatively high in the fourth quarter, producers are expected to keep marketings current. Commercial hog slaughter is forecast at 25.5 million head, down 3 percent from a year ago. The projected dressed weight is reduced 1 pound from last year's 186 pounds. Fourth-quarter production is forecast at 4,525 million pounds, down 4 percent from a year ago. For all of 1996, production is expected to be 4 percent below 1995. Production To Rebound in 1997 First-quarter slaughter comes mostly from the June-August pig crop and the September market hog inventory weighing under 60 pounds, which were 5 and 4 percent below a year ago. Slaughter in the first quarter is projected at 22.65 million head, down 4 percent from a year ago. Share of the pig crop and market hog inventory expected to be slaughtered tracks close to the previous 5-year average. Producers as of September 1 indicated intentions of having 2.8 million sows farrow during September-November. Given farrowing intentions and a continued rise in pigs per litter, the September-November pig crop is projected to be about 2.5 percent larger than in 1995. The projected pig crop indicates an April-June 1997 slaughter of about 22.9 million head, which would be 3 percent above 1995. The December 1996-February 1997 pig crop is projected to total about 23.4 million pigs, about 1.5 percent larger than a year earlier. The projection is based on September 1 farrowing intentions and the expectation that pigs per litter will rise to 8.65. This pig crop will supply most of the hogs for July-September 1997 slaughter which is projected to be about 23.6 million head, nearly 4 percent higher than in 1996. In 1995 and 1996, third-quarter hog slaughter as a percentage of the December-February pig crop was below the historical level. Thus, with slaughter closer to the relationship's historical average, slaughter in July-September 1997 would be up more than the pig crop. Returns above cash costs are expected to continue as feed prices are projected to decline and hog prices to remain relatively strong. The favorable returns are expected to prompt producers to increase the number of sows farrowing in March-May 1997 by nearly 4 percent and the resulting pig crop is expected to be almost 6 percent larger than in 1996. Hog slaughter in fourth-quarter 1997 is projected to be about 4 percent larger than the forecast for the same period in 1996. The percentage of the March-May crop projected to be slaughtered in fourth-quarter 1996 is above the average of recent years. Hog Prices To Average in Mid-$50's Hog prices are expected to average in the mid-$50's per cwt in fourth-quarter 1996 through third-quarter 1997. Continuing strong exports, economic growth, increasing food service demand, and relatively low pork stocks are factors that should support prices over the next 15 months. However, prices may be tempered by rising supplies of competing meats. Pork production declines will boost fourth-quarter 1996 and first-quarter 1997 prices above a year earlier. However, increased production in the second and third quarters of 1997 will put prices at or below 1996. Production is expected to rise about 4 percent in fourth-quarter 1997, which will push hog prices below $50 per cwt. Retail Prices Rise Sharply Retail prices this year are expected to average about 10 percent above 1995, and rise an additional 2-3 percent in 1997. Farm-retail price spreads are widening in 1996 after narrowing in 1995. Spreads are expected to remain relatively wide in 1997. Pork Exports Up Sharply In the first 7 months of 1996 the U.S. exported 592 million pounds of pork, up 34 percent from a year earlier. Enormous shipments to Japan last spring and very healthy increases in exports to Canada largely account for the strong growth in pork exports. The threat that the Japanese Safeguard (SG) may be imposed drove the export market during January-July. The SG is the primary determinant in the pattern of exports to Japan, and also a contributing factor in the growth of U.S. exports to Canada. Japanese Trade Policy Continues as Driving Force The SG is sanctioned by the World Trade Organization (WTO) as a legal means available to the Japanese government of protecting domestic pork producers from significant surges in imports of pork products. The SG effectively raises the minimum price of imported pork. It can be imposed when cumulative quarterly pork imports exceed the average import quantity for the same period in the previous 3 fiscal years by 119 percent. Because Japanese imports of 1.1 billion pounds in the first 3 months of the 1996 Japanese fiscal year (April 1-March 31) were more than 119 percent of 380 million pounds--the average quantity imported in the first quarters of fiscal years 1993-95--the Japanese government raised the minimum price of imported pork on July 1, 1996. Until March 31, 1997, the minimum price of pork imported into Japan will be $2.88 per pound, up 24 percent from $2.33, making imported pork less competitive with domestically produced pork. In anticipation of SG imposition in the summer of 1996, Japanese buyers imported huge quantities of pork from the U.S., Taiwan, Denmark, and Canada in the first quarter of fiscal 1996. Consequently, the bulk of forecast Japanese imports for fiscal 1996 is bunched in the April-June period, rather than more evenly distributed throughout the year. Much of the 34-percent increase in January-June U.S. exports came during the April-June period and is attributable to the "run-up" to the SG. Frozen product made up over 85 percent of Japanese pork imports in the first quarter of fiscal year 1996. More than 65 percent of U.S. exports to Japan in this period were frozen product, up significantly from a year earlier. The threat of SG imposition provides a strong incentive to maximize frozen pork imports because frozen pork is used mainly as a manufacturing input in Japan, and thus, carries lower margins than fresh product. Because manufacturers are able to pass on less of the SG- induced price increase of frozen pork to consumers, the run-up to the SG is characterized by high percentages of imported frozen product. When the SG is in place, the proportion of frozen imports drops off significantly. Under the SG of November 1, 1995, through March 31, 1996, monthly U.S. exports of fresh product increased from a year earlier in all but one month. In July, the U.S. exported almost 16 million pounds of fresh product to Japan, up 5 percent over a year earlier. The higher margins associated with fresh product, together with rigid shelf-life restrictions, support the fresh side of the Japanese market while the SG is in place. From the perspective of the Japanese government, the SG appears to be having the desired effect, as expectations now are that 1996 Japanese pork imports will not significantly differ from last year's 1.8 billion pounds. The U.S. is expected to export more pork to Japan this year than in 1995 however, because over one half of U.S. exports are of "SG-proof" fresh product. Also, Taiwan, the main U.S. competitor in the Japanese market, is expected to export less pork to Japan in 1996 than last year. In Taiwan this year, high domestic pork prices brought about in part by disease problems are keeping some product at home. Mounting environmental problems are restricting production expansion, and slowing export growth. The slowdown in Taiwanese exports will create market opportunities in Japan for the U.S., particularly on the fresh side of the market. Other competitors in the Japanese market, such as Canada, may provide some competition for the gap in the fresh market created by reduced Taiwanese exports. Canada and Denmark will compete with the U.S. on the frozen side. It is possible that Japanese imports could be slowed further in the current fiscal year. Another WTO-legal means of protecting Japanese pork producers is the Special Safeguard (SSG). The SSG can be invoked when fiscal year import volumes exceed certain trigger levels. When this happens, tariff levels, currently at 4.8 percent, would be increased by 33 percent to 5.4 percent for the remainder of the fiscal year. Trigger levels are determined by the ratio of imports to total pork consumption. When imports account for more than 30.1 percent of total consumption, the SSG can be imposed when imports reach 105 percent of imports in the previous year. For fiscal year 1996, imports through July were more than 40 percent of total Japanese consumption. The SSG could thus be triggered if imports exceed 1.8 billion pounds. Canada Is a Major Player in the U.S. Market Canada figured prominently in the U.S. pork market in the first 7 months of 1996. U.S. imports of Canadian hogs boomed, averaging almost 55,000 head per week. In 1995, the comparable figure was about 30,000 head per week. Canadian producers are exporting hogs to the U.S. because of higher U.S. hog prices, favorable U.S.-Canadian exchange rates, and lower countervailing duties. Hog prices are relatively lower in Canada in part because high fixed and labor costs in the Canadian processing industry force packers to bid hog prices lower. Also, increased slaughter capacity in the U.S. eastern Corn Belt has increased demand for hogs in that region. The lower Canadian slaughter resulting from higher live exports to the U.S., together with higher Canadian exports to Japan in the run-up to the SG, increased demand for pork in Canada, particularly on the manufacturing side of the market. Consequently, lower-valued U.S. cuts have flowed into Canada, at rates double those of 1995. Keeping things in perspective, however, the U.S. continues to be a large net importer of Canadian pork products. In the first 7 months of 1996, U.S. imports from Canada were 187 million pounds higher than exports to Canada. Principal Contributors: Leland Southard and Mildred Haley TABLES Federally inspected hog slaughter ------------------------------------------------------------------------- Week Hogs % Chg Barrows/gilts % Chg Sows % Chg ended 1995 1996 96/95 1995 1996 96/95 1995 1996 96/95 ------------------------------------------------------------------------- 1,000 hd 1,000 hd % 1,000 hd % Jan. 6 1628 1618 1762 1549 1553 76 66 55 -16 13 1964 1891 1531 1866 1805 58 80 72 -10 20 1822 1765 1638 1721 1679 77 82 72 -12 27 1791 1896 1641 1699 1813 72 74 69 -7 Feb. 3 1752 1686 1559 1672 1613 67 62 62 -0 10 1781 1779 1608 1693 1698 72 71 68 -5 17 1810 1794 1632 1724 1711 65 69 70 1 24 1808 1808 1667 1719 1723 71 70 71 2 Mar. 2 1876 1824 1737 1783 1737 70 74 73 -2 9 1888 1758 1678 1803 1672 72 68 73 7 16 1908 1845 1661 1817 1761 71 71 71 -1 23 1890 1780 1714 1799 1693 66 72 71 -0 30 1837 1776 1655 1753 1694 67 66 69 5 Apr. 6 1819 1796 1729 1732 1707 70 68 73 7 13 1788 1777 1726 1713 1689 66 61 73 19 20 1824 1840 1720 1742 1749 65 66 76 16 27 1859 1777 1708 1773 1688 71 67 75 11 May. 4 1867 1792 1685 1779 1698 66 70 79 13 11 1876 1692 1663 1789 1603 69 69 74 6 18 1774 1691 1642 1690 1609 70 68 70 2 25 1769 1611 1414 1686 1534 59 68 64 -5 June 1 1603 1439 1635 1526 1369 77 62 58 -6 8 1762 1568 1583 1667 1482 74 78 72 -8 15 1721 1629 1539 1630 1546 75 75 70 -6 22 1702 1582 1549 1615 1504 77 71 66 -8 29 1735 1573 1367 1637 1494 62 79 66 -16 July 6 1466 1333 1647 1391 1272 87 62 51 -19 13 1687 1616 1559 1595 1532 75 74 70 -6 20 1702 1663 1616 1605 1577 78 80 72 -9 27 1683 1598 1584 1585 1520 79 79 65 -18 Aug. 3 1733 1629 1677 1637 1548 79 78 68 -12 10 1704 1636 1664 1610 1559 77 77 66 -15 17 1779 1718 1684 1689 1648 79 73 58 -20 24 1817 1746 1722 1727 1668 80 74 65 -12 31 1795 1757 1554 1701 1677 69 75 67 -10 Sept. 7 1650 1525 1879 1570 1460 77 65 54 -17 14 1896 1935 1905 1804 1856 79 76 66 -13 21 1888 1827 1876 1801 1749 83 71 66 -8 28 1888 1570 1797 82 75 Oct. 5 1889 1886 1814 81 70 12 1834 1935 1751 85 67 19 1909 1928 1831 83 63 26 1993 1946 1908 89 70 Nov. 2 2002 1873 1912 93 74 9 1981 1945 1894 95 72 16 2011 1617 1917 67 77 23 1724 1974 1654 92 57 30 1994 1973 1906 95 73 Dec. 7 1914 1893 1823 92 74 14 1891 1694 1808 82 69 21 1840 1578 1752 69 71 28 1672 1549 1607 66 56 ------------------------------------------------------------------------- 1/ Corresponding date to 1995 Jan. 9 ; 1994, Jan. 8 Selected price and slaughter statistics for meat animals and meat ------------------------------------------------------------------------------ Item Apr-96 May-96 Jun-96 Jul-96 Aug-96 Sep-96 5/ ------------------------------------------------------------------------------ Hog prices: Barrows and gilts 230-250 lb Iowa/S. Minn. No. 1-3 50.27 58.22 55.98 59.13 59.59 54.53 Sioux City 50.88 58.29 56.45 59.47 60.49 54.60 6 markets 1/ 50.47 57.91 56.14 59.20 59.81 54.87 Sows: 6 markets 1/ 37.86 43.84 47.21 48.25 50.84 48.95 Feeder pigs: No. 1 & 2, So. Mo., 40-50 lb (per hd.) 33.92 Slaughter Steers: Choice, 1100-1300 lb Nebraska direct 59.49 59.72 61.56 63.79 66.82 70.77 Farm prices: Hogs 49.70 56.70 56.20 58.70 59.70 54.40 Beef cattle 54.80 54.60 56.10 58.90 60.30 63.80 Meat prices: Wholesale Central U.S. markets Pork cut-out, #2 2/ 67.50 76.68 73.94 79.08 79.97 74.54 Pork loins 14-18 lb 119.70 131.61 115.73 126.16 118.18 112.28 Pork bellies 12-14 lb 69.86 79.50 72.64 89.49 88.40 68.12 Hams, skinned 17-20 lb 57.03 65.26 71.49 77.52 82.63 85.29 20-26 lb 55.95 64.97 71.88 77.27 81.03 82.65 Boxed beef cut-out Choice, 1-3 700-850 lb 95.42 96.87 100.69 101.01 103.34 104.47 Retail prices Pork 208.60 213.60 222.50 225.70 231.40 NA Bacon, sliced 224.00 235.00 249.00 254.00 268.00 NA Chops, center cut 334.00 334.00 353.00 348.00 350.00 NA Ham, rump or shank 173.00 182.00 187.00 195.00 199.00 NA Sirloin roast 236.00 240.00 251.00 254.00 259.00 NA Picnic, smoked 120.00 119.00 118.00 122.00 127.00 NA Sausage, fresh 191.00 195.00 202.00 201.00 205.00 NA Beef, Choice 279.30 276.60 276.30 277.60 281.10 NA Composite broiler 146.40 149.10 150.60 149.90 151.90 NA Price indexes: (BLS) All meats 136.90 136.40 138.80 139.60 141.80 NA Beef and veal 133.90 131.30 131.90 132.30 134.40 NA Pork 139.50 142.10 148.80 150.40 153.50 NA Poultry 147.60 149.60 151.30 152.70 154.50 NA Commercial: 4/ Slaughter Hogs 8,034 7,633 6,532 7,338 7,675 7,690 Barrows and gilts 7,636 7,251 6,198 6,977 7,327 7,369 Sows 332 320 281 304 290 268 Stags and boars 66 62 53 57 58 53 Cattle 3,111 3,329 3,146 3,148 3,210 2,735 Production Pork 1,484 1,413 1,206 1,339 1,394 1,410 Beef 2,153 2,303 2,186 2,194 2,260 1,928 Veal 28 30 29 32 32 31 Lamb and mutton 25 21 18 20 20 20 Cold storage stocks: 5/ Total pork 352.86 385.49 381.33 351.83 322.66 320.18 Hams 35.73 61.64 79.80 79.83 78.91 83.62 Pork belly 47.66 57.17 63.52 56.77 28.53 18.90 Ribs 63.36 62.25 51.98 36.96 35.32 28.86 Trim & other 119.59 117.54 108.64 104.81 108.94 117.94 Federal inspected: Hog weights live wt 255 255 256 252 251 251 dressed wt 186 186 186 184 183 183 ------------------------------------------------------------------------------ 1/ Omaha, Sioux City, Sioux Falls, So. St. Joseph, and So. St. Paul. 2/ 175 lb. carcass 3/ Classes esimated. 4/ End of month. 5/ Preliminary Pork: Retail, wholesale, and farm values, spreads, and farmers' share -------------------------------------------------------------------------- Gross Wholesale- Year Retail Wholesale farm By-product Net farm retail price 1/ value 2/ value 3/ allowance value 5/ Total spread --------------------------- Cents per pound ------------------------- 1991 211.9 108.9 83.1 4.7 78.4 133.5 103.0 1992 198.0 98.9 72.0 4.2 67.8 130.2 99.1 1994 197.6 102.8 77.2 4.7 72.5 125.1 94.8 1994 198.1 98.9 67.4 4.5 62.9 135.2 99.2 1995 Jan 191 91 64 5 59 132 100 Feb 190 93 67 5 62 128 97 Mar 194 91 64 5 60 134 102 I 192 92 65 5 60 131 100 Apr 191 90 61 4 57 134 101 May 191 93 64 4 59 132 98 Jun 189 99 74 5 69 120 90 II 190 94 66 5 62 129 96 Jul 191 102 80 5 75 117 90 Aug 197 106 84 6 78 119 91 Sep 198 107 82 6 77 121 91 II 196 105 82 6 77 119 91 Oct 202 108 78 5 72 130 95 Nov 201 101 68 5 63 138 100 Dec 202 104 75 5 70 133 98 IV 202 104 73 5 68 134 97 Year 195 99 72 5 67 128 96 1996 Jan 201 102 72 5 67 134 99 Feb 208 106 79 5 74 134 102 Mar 210 108 83 5 78 132 101 I 206 105 78 5 73 133 101 Apr 209 111 86 5 80 128 98 May 214 121 98 6 92 122 93 Jun 222 117 95 7 89 134 106 II 215 116 93 6 87 128 99 Jul 226 123 101 7 94 132 103 Aug 231 127 102 7 94 137 105 ------------------------------------------------------------------------ 1/ Estimated weighted-average of BLS prices of retail cuts from pork carcass. 2/ Value of wholesale quantity equivalent to 1 lb of retail cuts. A wholesale carcass equivalent of 1.06 is used. 3/ Market values to producer for 1.7 lb of live animal equivalent to 1 lb of retail cuts. 4/ Portion of gross farm value attributable to edible and inedible by-products. 5/ Gross farm value minus by-product allowance. 6/ Percent net farm value is of retail price. Farm- Year wholesale Farmers' spread share 6/ -------------------------- --Percent-- 1991 30.5 37 1992 31.1 34 1993 31.1 34 1994 36.0 32 1995 Jan 32 31 Feb 31 33 Mar 32 31 I 32 31 Apr 33 30 May 34 31 Jun 30 36 II 32 32 Jul 27 39 Aug 28 40 Sep 30 39 II 28 39 Oct 36 36 Nov 38 31 Dec 35 34 IV 36 34 Year 32 34 1996 Jan 35 33 Feb 32 36 Mar 31 37 I 32 35 Apr 31 38 May 29 43 Jun 28 40 II 29 40 Jul 29 42 Aug 32 41 -------------------------- 1/ Estimated weighted-average of BLS prices of retail cuts from pork carcass. 2/ Value of wholesale quantity equivalent to 1 lb of retail cuts. A wholesale carcass equivalent of 1.06 is used. 3/ Market values to producer for 1.7 lb of live animal equivalent to 1 lb of retail cuts. 4/ Portion of gross farm value attributable to edible and inedible by-products. 5/ Gross farm value minus by-product allowance. 6/ Percent net farm value is of retail price. Commercial hog slaughter, production, and prices 1/ ---------------------------------------------------------------------- Slt'r hog Barrows Boars & Dress- Comm'l Iowa/ Year & gilts Sows Stags Total wt. prod. S. Minn ---------------------------------------------------------------------- --------- 1,000 hd. --------- lb. 1,000 lb $/cwt 1992 I 22,635 959 208 23,802 182 4,321 39.55 II 20,988 991 223 22,202 182 4,033 45.70 III 22,437 1,082 227 23,746 180 4,263 44.39 IV 23,904 1,019 215 25,138 182 4,567 42.48 Year 89,964 4,051 873 94,888 181 17,184 43.03 1993 I 21,935 903 219 23,057 182 4,204 44.83 II 21,516 910 235 22,661 183 4,151 47.59 III 21,535 1,017 225 22,777 182 4,140 48.05 IV 23,401 966 207 24,574 185 4,535 43.93 Year 88,387 3,796 886 93,069 183 17,030 46.10 1994 I 21,600 916 226 22,742 184 4,181 45.70 II 21,806 920 240 22,966 185 4,239 42.90 III 22,407 1,035 232 23,674 183 4,326 40.50 IV 24,945 1,140 230 26,315 187 4,912 31.03 Year 90,758 4,011 928 95,697 185 17,658 40.03 1995 I 23,038 946 241 24,225 185 4,488 38.56 II 22,498 922 223 23,643 186 4,393 38.91 III 22,058 981 222 23,261 182 4,241 48.75 IV 24,089 911 197 25,197 186 4,689 43.19 Year 91,683 3,760 883 96,326 185 17,811 42.35 1996 I 2/ 22,561 912 178 23,651 186 4,388 46.23 II 2/ 21,118 933 181 22,199 185 4,103 54.90 III 3 21,655 900 145 22,700 183 4,150 55.75 IV 3/ 24,500 185 4,525 54-56 Year 3/ 93,075 184 17,166 53.45 1997 I 3/ 22,850 185 4,200 52-56 II 3/ 22,900 186 4,250 53-57 III 3/ 23,800 183 4,325 53-57 Year 3/ 94,850 185 17,500 51-55 1/ Classes estimated. 2/ Preliminary. 3/ Forecast Hogs on farms, farrowings, and pig crops, U.S. ------------------------------------------------------------ Inventory 1992 1993 1994 1995 1996 --------------------------------------------------------------------- 1,000 Head March 1 inventory 56,180 56,545 57,350 58,465 56,430 Breeding 7,155 7,040 7,210 6,998 6,765 Market 49,025 49,505 50,140 51,467 49,575 Under 60 lb 19,040 18,480 18,780 19,251 18,790 60-119 lb 11,865 12,107 12,190 12,498 11,980 120-179 lb 9,780 10,372 10,430 10,594 10,095 180 + lb 8,340 8,546 8,740 9,124 8,710 June 1 inventory 59,175 58,395 60,715 59,560 57,200 Breeding 7,520 7,320 7,565 7,180 6,870 Market 51,655 51,075 53,150 52,380 50,330 Under 60 lb 21,540 20,770 22,125 21,270 20,265 60-119 lb 13,005 12,865 13,145 13,060 12,700 120-179 lb 9,615 9,590 9,825 9,865 9,800 180 + lb 7,495 7,850 8,055 8,185 7,565 Sept. 1 inventory 60,655 59,030 62,320 60,540 Breeding 7,290 7,130 7,415 6,898 Market 53,365 51,900 54,905 53,642 Under 60 lb 20,090 19,675 20,790 20,235 60-119 lb 13,575 13,175 13,960 13,532 120-179 lb 10,905 10,545 11,170 10,985 180 + lb 8,795 8,505 8,985 8,890 Dec. 1 inventory 57,649 58,202 57,904 59,990 58,200 Breeding 7,229 7,109 7,165 7,060 6,845 Market 50,420 51,093 50,739 52,930 51,355 Under 60 lb 18,671 19,122 19,173 19,556 18,805 60-119 lb 12,966 12,846 12,659 13,087 12,840 120-179 lb 10,367 10,420 10,212 10,941 10,710 180 + lb 8,416 8,705 8,695 9,346 9,000 Sows farrowing Dec.-Feb. 1/ 2,892 2,808 2,885 2,886 2,745 March-May 3,368 3,220 3,390 3,170 2,964 Dec.-May 1/ 6,260 6,028 6,275 6,056 5,709 June-August 3,020 2,972 3,107 2,976 2,760 Sept.-Nov. 2,992 2,982 2,997 2,815 June-Nov. 6,012 5,954 6,104 5,791 5,561 Pig crop Dec.-Feb. 1/ 23,258 22,871 23,368 23,851 23,054 March-May 27,208 26,135 27,984 26,373 25,059 Dec.-May 1/ 50,466 49,006 51,352 50,224 48,113 June-August 24,590 24,041 25,547 24,797 Sept.-Nov. 24,086 24,003 24,517 23,463 June-Nov. 48,676 48,044 50,064 48,260 Pigs per litter Dec.-Feb. 1/ 8.04 8.15 8.10 8.27 8.40 March-May 8.08 8.12 8.26 8.32 8.47 Dec.-May 1/ 8.06 8.13 8.18 8.29 8.43 June-August 8.14 8.09 8.22 8.33 Sept.-Nov. 8.05 8.05 8.18 8.33 June-Nov. 8.10 8.07 8.20 8.33 --------------------------------------------------------------------- 1/ December preceding year. 2/ Intentions Hog breeding herd changes, United States ---------------------------------------------------------------------------- Item 1992 1993 1994 1995 1996 ---------------------------------------------------------------------------- Inventory change: December 1 breeding 1/ 7,229 7,109 7,165 7,060 6,845 December-February Sow slaughter 983 939 919 1,010 904 Stag/boar slaughter 197 213 205 233 179 Gilts/boars added 1,106 1,083 1,169 1,181 1,003 % of inventory 15.3% 15.2% 16.3% 16.7% 14.7% March 1 breeding 7,155 7,040 7,210 6,998 6,765 March-May Sow slaughter 934 896 914 907 955 Stag/boar slaughter 220 235 243 235 188 Gilts/boars added 1,519 1,411 1,512 1,324 1,248 % of inventory 21.2% 20.0% 21.0% 18.9% 18.4% June 1 breeding 7,520 7,320 7,565 7,180 6,870 June-August Sow slaughter 1,096 1,002 1,030 1,015 875 Stag/boar slaughter 228 225 242 232 168 Gilts/boars added 1,094 1,037 1,122 965 % of inventory 14.5% 14.2% 14.8% 13.4% September 1 breeding 7,290 7,130 7,415 6,898 6,770 September-November Sow slaughter 1,019 976 1,093 924 Stag/boar slaughter 216 217 225 204 Gilts/boars added 1,054 1,228 963 1,075 (6,770) % of inventory 14.5% 17.2% 13.0% 15.6% Sows entering breeding herd: December-February 1/ Sows farrowing 2,892 2,808 2,885 2,886 2,745 Sow slaughter 983 939 919 1,010 904 % of inventory 34.0% 33.4% 31.9% 35.0% 32.9% Sows added 1,459 1,351 1,424 1,294 1,123 % of inventory 43.3% 42.0% 42.0% 40.8% 37.9% March-May Sows farrowing 3,368 3,220 3,390 3,170 2,964 Sow slaughter 934 896 914 907 955 % of inventory 27.7% 27.8% 27.0% 28.6% 32.2% Sows added 586 648 631 713 751 % of inventory 19.4% 21.8% 20.3% 24.0% 27.2% June-August Sows farrowing 3,020 2,972 3,107 2,976 2,760 Sow slaughter 1,096 1,002 1,030 1,015 875 % of inventory 36.3% 33.7% 33.2% 34.1% Sows added 1,068 1,012 920 854 % of inventory 35.7% 33.9% 30.7% 30.3% September-November Sows farrowing 2,992 2,982 2,997 2,815 Sow slaughter 1,019 976 1,093 924 % of inventory 34.1% 32.7% 36.5% 32.8% Sows added 835 879 982 854 % of inventory 29.7% 30.5% 34.0% 31.1% ------------------------------------------------------------------------------ 1/ December preceding year 2/ Estimate North Central U.S. Hog Budget Farrow to Finish Simlator 1600 Head Operation (100 sows) Marketed During Sep-95 Oct-95 Nov-95 Dec-95 Jan-96 Cash receipts: 2/ Market hogs (94.25 lb) 46.17 43.29 37.91 41.62 40.51 Cull sows (5.75 lb) 2.30 2.49 2.08 2.04 2.04 Total 48.47 45.78 39.99 43.66 42.55 Cash expenses: Feed-- Corn (345.6 lb) 13.24 13.94 14.56 14.54 14.91 Soybean meal (70.6 lb) 6.80 6.83 7.15 7.16 7.49 Mixing concentrates (14.3 lb) 3.10 3.10 3.10 3.10 3.10 Total feed 23.14 23.87 24.81 24.80 25.50 Other-- Veterinary and medicine 3/ 1.28 1.28 1.28 1.28 1.28 Fuel, lube, and electricity 1.41 1.35 1.35 1.35 1.35 Mach. and building repairs 1.38 1.38 1.38 1.40 1.40 Hired labor 4/ 2.66 2.66 2.66 2.68 2.68 Miscellaneous 2.29 2.31 2.31 2.31 2.31 Total variable expenses 32.16 32.85 33.79 33.82 34.52 General farm overhead 1.42 1.43 1.43 1.43 1.43 Taxes and insurance 0.88 0.88 0.88 0.88 0.88 Interest 2.27 2.35 2.35 2.35 2.35 Total fixed expenses 4.57 4.66 4.66 4.66 4.66 Total cash expenses 5/ 36.73 37.51 38.45 38.48 39.18 Receipts less cash expenses 11.74 8.27 1.54 5.18 3.37 Capital replacement 10.62 10.74 10.74 10.74 10.74 Receipts less cash expenses and replacement 1.12 -2.47 -9.20 -5.56 -7.37 1/The feed rations and expense items do not necessarily coincide with the experience of individual hog operations. 2/Based on 94.25 lb of barrows and gilts liveweight and 5.75 lb of sows per cwt sold. 3/Includes costs of feed medication. 4/Based on .204 hours per cwt of liveweight hog marketed. 5/Does not include a charge for family or operator labor. North Central U.S. Hog Budget Farrow to Finish Simlator 1600 Head Operation (100 sows) Marketed During Feb-96 Mar-96 Apr-96 May-96 Jun-96 Cash receipts: 2/ Market hogs (94.25 lb) 44.45 45.96 47.54 54.21 53.52 Cull sows (5.75 lb) 2.15 2.28 2.38 2.74 2.94 Total 46.60 48.24 49.92 56.95 56.46 Cash expenses: Feed-- Corn (345.6 lb) 15.36 15.96 17.59 17.19 18.26 Soybean meal (70.6 lb) 7.62 7.88 8.47 8.87 8.72 Mixing concentrates (14.3 lb) 3.11 3.11 3.11 3.13 3.15 Total feed 26.09 26.95 29.17 29.19 30.13 Other-- Veterinary and medicine 3/ 1.29 1.29 1.29 1.30 1.30 Fuel, lube, and electricity 1.39 1.39 1.39 1.41 1.45 Mach. and building repairs 1.40 1.40 1.40 1.40 1.45 Hired labor 4/ 2.68 2.68 2.75 2.78 2.75 Miscellaneous 2.34 2.34 2.34 2.36 2.36 Total variable expenses 35.19 36.05 38.35 38.44 39.44 General farm overhead 1.45 1.45 1.45 1.46 1.46 Taxes and insurance 0.89 0.89 0.89 0.91 0.91 Interest 2.37 2.37 2.37 2.33 2.33 Total fixed expenses 4.71 4.71 4.71 4.70 4.70 Total cash expenses 5/ 39.90 40.76 43.06 43.14 44.14 Receipts less cash expenses 6.70 7.48 6.86 13.81 12.32 Capital replacement 10.77 10.77 10.77 10.73 10.73 Receipts less cash expenses and replacement -4.07 -3.29 -3.91 3.08 1.59 1/The feed rations and expense items do not necessarily coincide with the experience of individual hog operations. 2/Based on 94.25 lb of barrows and gilts liveweight and 5.75 lb of sows per cwt sold. 3/Includes costs of feed medication. 4/Based on .204 hours per cwt of liveweight hog marketed. 5/Does not include a charge for family or operator labor. North Central U.S. Hog Budget Farrow to Finish Simlator 1600 Head Operation (100 sows) Marketed During Jul-96 Aug-96 Sep-96 Cash receipts: 2/ Market hogs (94.25 lb) 55.91 56.71 51.46 Cull sows (5.75 lb) 3.05 3.22 3.07 Total 58.96 59.93 54.53 Cash expenses: Feed-- Corn (345.6 lb) 19.04 19.18 20.97 Soybean meal (70.6 lb) 8.94 9.81 9.86 Mixing concentrates (14.3 lb) 3.16 3.18 3.18 Total feed 31.14 32.17 34.01 Other-- Veterinary and medicine 3/ 1.31 1.32 1.32 Fuel, lube, and electricity 1.49 1.56 1.56 Mach. and building repairs 1.45 1.45 1.45 Hired labor 4/ 2.77 2.77 2.77 Miscellaneous 2.33 2.34 2.34 Total variable expenses 40.50 41.61 43.45 General farm overhead 1.44 1.45 1.45 Taxes and insurance 0.91 0.91 0.91 Interest 2.35 2.36 2.36 Total fixed expenses 4.70 4.73 4.73 Total cash expenses 5/ 45.20 46.34 48.18 Receipts less cash expenses 13.76 13.59 6.35 Capital replacement 10.73 10.73 10.73 Receipts less cash expenses and replacement 3.03 2.86 -4.38 1/The feed rations and expense items do not necessarily coincide with the experience of individual hog operations. 2/Based on 94.25 lb of barrows and gilts liveweight and 5.75 lb of sows per cwt sold. 3/Includes costs of feed medication. 4/Based on .204 hours per cwt of liveweight hog marketed. 5/Does not include a charge for family or operator labor. U.S. HOG & PORK IMPORTS & EXPORTS 1983 1984 1985 1986 1987 1988 Carcass wt., thousand lb. Pork Imports Canada 276,555 356,055 422,860 485,257 545,586 508,773 Denmark 203,726 340,969 428,229 368,484 345,292 326,509 Poland 91,067 87,029 108,685 121,851 125,342 128,619 Hungary 35,258 42,082 54,746 48,486 50,011 44,195 Netherlands 35,425 36,712 34,030 12,289 17,350 22,591 Other 64,849 91,072 79,200 85,221 111,546 106,545 Total 706,880 953,919 1,127,750 1,121,588 1,195,126 1,137,231 Pork Exports Japan 110,528 59,932 29,783 39,562 61,731 121,209 Canada 27,798 17,402 10,073 10,099 9,436 8,844 Mexico 32,970 34,043 32,123 2,262 7,098 34,897 Caribbean 17,629 14,345 14,381 14,297 12,334 10,800 Other 30,382 38,158 42,031 19,445 18,714 19,481 Total 219,306 163,880 128,391 85,665 109,312 195,231 Hog Imports Head Canada 447,391 1,322,015 1,226,151 503,728 446,056 835,125 Under 110 lb. Total 447,465 1,322,017 1,226,571 503,728 446,056 835,949 Hog Exports Total 23,326 14,332 18,278 12,993 7,409 91,292 1989 1990 1991 1992 1993 1994 1995 Carcass wt., thousand lb. Pork Imports Canada 453,182 437,058 403,938 391,233 402,275 421,768 453,925 Denmark 198,391 273,244 245,956 168,908 233,772 244,545 144,516 Poland 112,789 66,614 21,640 13,192 13,834 11,581 11,984 Hungary 26,159 33,117 39,028 21,323 29,933 18,210 10,608 Netherlan 15,259 15,650 17,697 16,894 22,771 16,769 10,671 Other 89,870 72,198 46,505 33,955 37,613 30,896 32,258 Total 895,650 897,882 774,765 645,505 740,197 743,769 663,963 Pork Exports Japan 147,752 125,487 122,886 212,591 220,933 239,876 364,676 Canada 12,990 22,796 27,024 31,430 36,364 52,902 57,771 Mexico 60,161 38,282 81,495 107,747 92,986 150,252 59,855 Caribbean 14,996 14,958 13,332 9,523 8,669 8,351 11,120 Other 26,521 36,893 37,537 45,042 76,169 80,607 277,286 Total 262,419 238,416 282,275 406,332 435,121 531,988 770,707 Hog Imports Head Canada 1,073,164 886,277 1,054,236 669,769 837,832 914,755 1,747,160 Under 110 169,738 204,184 226,303 226,896 280,813 401,981 651,096 Total 1,073,646 890,252 1,057,685 674,469 840,050 921,274 1,750,138 Hog Exports Total 93,343 56,652 267,853 105,631 40,636 136,148 16,059 Jul-95 Aug-95 Sep-95 Oct-95 Nov-95 Dec-95 Carcass wt., thousand lb. Pork Imports Canada 35,379 40,340 32,836 43,616 36,587 35,805 Denmark 9,978 9,392 10,830 12,723 13,653 12,258 Poland 678 491 910 1,224 1,666 740 Hungary 1,322 1,464 1,105 628 504 478 Netherlands 732 843 340 1,060 910 1,161 Other 2,269 2,307 2,378 2,676 2,188 2,340 Total 50,358 54,837 48,399 61,927 55,507 52,782 Pork Exports Japan 31,508 37,885 47,110 40,593 28,067 22,881 Canada 4,836 5,654 5,645 5,033 7,574 6,077 Mexico 4,327 4,741 3,612 5,276 5,106 6,360 Caribbean 806 534 986 866 1,223 1,281 Other 18,658 17,592 15,381 17,263 18,963 23,813 Total 60,135 66,406 72,734 69,031 60,933 60,411 Hog Imports Head Canada 142,201 187,886 175,377 216,340 162,509 180,421 Under 110 60,270 74,836 57,276 59,418 50,879 42,253 Total 142,821 188,129 175,377 216,363 162,510 181,029 Hog Exports Total 1,745 685 1,932 636 2,635 3,217 Jan-96 Feb-96 Mar-96 Apr-96 May-96 Jun-96 Jul-96 Carcass wt., thousand lb. Pork Imports Canada 34,028 30,734 35,711 33,147 35,922 39,274 35,956 Denmark 8,443 10,023 11,081 10,806 10,840 9,494 12,307 Poland 249 1,075 1,225 680 969 855 753 Hungary 305 358 958 809 1,222 917 1,060 Netherlands 831 741 881 902 1,080 598 997 Other 1,823 2,527 2,830 2,236 3,002 2,430 2,340 Total 45,678 45,458 52,686 48,580 53,035 53,569 53,413 Pork Exports Japan 27,478 36,008 49,957 84,601 70,151 41,766 29,588 Canada 7,378 8,513 8,660 9,064 8,415 6,954 8,296 Mexico 5,912 5,577 3,684 3,159 3,467 2,531 3,580 Caribbean 473 994 937 779 1,020 678 863 Other 23,951 26,734 15,222 31,044 31,424 17,848 14,490 Total 65,193 77,826 78,460 128,647 114,477 69,777 56,817 Hog Imports Head Canada 219,454 199,278 211,432 212,222 222,897 195,472 248,513 Under 110 50,791 69,291 70,750 65,664 64,941 46,765 72,341 Total 219,520 199,363 211,432 212,222 222,897 195,485 248,513 Hog Exports Total 13,770 10,629 4,794 5,086 2,430 1,160 2,698 END-OF-FILE