July 2 Weekly Update

7/2 – In Friday’s quarterly Hogs && Pigs report, the USDA confirmed that there is a mountain of pork in the pipeline. Total U.S. inventories on June 1, at 73.5M head, are up 3.4% from a year ago and the highest June 1 inventory since estimates began in 1964. Breeding inventory was up 3.5% from last year; market hog inventory up 3.4%. The March-May 2018 pig crop was up 3.6% from 2017 and the largest since 1970. The average number of pigs saved per litter was a record high 10.63 for March-May. Farrowing intentions for June-Aug and Sept-Nov 2018 are both 2% above a year ago and 4% higher than 2017. The USDA projects Q2 and Q3 2018 pork output to be 4% above a year ago; and Q4 up 6%. Q3 hog prices are forecast to be 19% below a year ago; and Q4 down 17%. Maintaining pork exports to Mexico will be absolutely vital to absorbing excess U.S. supplies.