January 5

1/5 - In its quarterly report, the USDA said that hog and pig inventories on Dec 1 (75.55M head) were 0.6% higher than a year ago and slightly above last quarter (+0.3%). An 0.8% increase (year-over-year) in market hogs and a 0.9% decrease in the breeding herd were both above expectations and modestly bearish for prices. Farrowing intentions for 2026 are roughly 2% above 2025 – putting numbers back near 2024 levels after a decline in 2025. The number of pigs saved per litter was a record-high 12.03 in Nov. In Dec’s WASDE, the USDA projected U.S. pork production to decline by 1.2% in 2025 - and be flat in 2026. A 2.1% decline in pork exports in 2025 partially offsets the 1.2% drop in output. Lean hog futures averaged $80.98/cwt in 2023, $84.95 in 2024 (+4.9%), and $92.15 in 2025 (+8.5%). Forward futures contracts for 2026 are averaging $92.58 - on par with 2025 - with a high of $103.72 for the July contract.