The first quarter of 2017 shows hog and pigs numbers at record highs at 71 million head, up 4 percent over the same period last year.
The breeding herd is at 6.07 million head, up 1 percent from the same period in 2016. Market hog inventory is at 64.9 million head for the first quarter, up 4 percent from last year, but down 1 percent from last quarter, according to the report released by the United States Department of Agriculture.
Len Steiner, president of Steiner Consulting Group in Merrimack, N.H. said exports are an important part of keeping prices from dipping. Exports of all pork is up 21.7 percent and per capita consumption of pork is up 1.2 percent.
In 2016, slaughter capacity was pushed to 91,000 head over capacity in the biggest week of the year. Opening and expansion of plants in Minnesota, Iowa and Michigan should increase slaughter capacity by 138,000 head by this fall. This is expected to help the increase in pig numbers, but slaughter capacity is still expected to be more than 49,000 head over capacity.
Steiner expects prices to average $72 per hundred weight on the Iowa/Minnesota market. He expects $74/cwt. for the third quarter average and $63/cwt. for the fourth quarter average.
“Exports are very important. China’s hog prices are higher than the U.S., so it is economically feasible for them to purchase our pork,” Steiner said.
He said hog producers are still working on the money they made in 2014 when prices were so good. Expansion is expected to continue in 2017, especially with low feed costs.