April 16, 2021

Pork report brings good news for battered U.S. producers

DES MOINES, Iowa — The first U.S. Department of Agriculture Hogs and Pigs report of 2021 brought good news for U.S. pork producers.

With pig numbers down across every category of the report, heralding smaller supplies of pork, analysts on a Pork Checkoff-sponsored media call following the report’s release saw bulls running for an industry battered by the impacts of COVID-19 in 2020.

“I don’t see this as just a mildly bullish report. This is the reprieve the pork producers have been looking for, for quite some time,” said Joe Kerns, of Partners for Production Agriculture, based in Ames.

“I think this is kind of — maybe a shocker, maybe a game changer,” said Daniel Bluntzer, partner, of NFC Markets, in Robstown, Texas.

“I think this puts us back pretty close to where we were, in terms of slaughter volume, in 2019, and it gives us a really stronger outlook with respect to prices,” said James Mintert, Purdue Extension economist and director of the Center for Commercial Agriculture at Purdue University.

Certainly, the numbers, as of March 1, told the story of fewer pigs, less pork now and going forward into the first part of 2021.

• All hogs and pigs: 74.773 million, down 1.8% from a year ago; pre-report estimates had it up by 0.1%.

• Breeding herd: 6.215 million, down 2.5% from a year ago; pre-report estimates had it down by 1.1%.

• Marketing herd: 68.558 million, down 1.8% from a year ago; pre-report estimates had it up by 0.2%.

Weight Categories

• Under 50 pounds: 21.288 million, down 1.3%; pre-report estimates had it up by 0.6%.

• 50 to 119 pounds: 19.118 million, down 1.2%; pre-report estimates had it up by 0.4%.

• 120 to 179 pounds: 14.705 million, down 2.5%; pre-report estimates had it up by 0.5%.

• 180 pounds and over: 13.446 million, down 2.5%; pre-report estimates had it down slightly.

Farrowings

• December-February farrowings: 3.014 million, down 0.9%; pre-report estimates had it up by 0.5%.

• March-May intentions: 3.070 million, down 2.5%; pre-report estimates had it down slightly.

• June-August intentions: 3.124 million, down 4.2%; pre-report estimates had it down slightly.

New Pigs

• December-February pig crop: 33.27 million; down 1.4%; pre-report estimates had it up by 0.7%.

• December-February pigs saved per litter: 10.94, down 0.5%; pre-report estimates had it up by 0.1%.

With anecdotal evidence of new strains of Porcine Reproductive and Respiratory Syndrome taking a toll on breeding herds and new pigs, analysts said that did have an impact on the numbers in the first-quarter report.

“If history is any indication, we’ll see some further downward revisions. I think there’s disease evidence that’s starting to pop up in these numbers,” said Kerns, who also referred to the anecdotal evidence from producers around the country regarding available pig spaces and prices of weaned pigs increasing in recent weeks.

“The market has been kind of feeling this one a little bit. Certainly the anecdotal quantity of spaces available, the value of weaned pigs traded into the marketplace would give you an indication that something wasn’t quite up to par as far as what expectations were looking at,” Kerns said.

Steve Meyer, who reads the report numbers for the Pork Checkoff call, said the PRRS losses likely contributed to the swings in some of the small pig-related numbers.

“Two of the more negative numbers in that thing, relative to a year ago, were the December-February pig crop and December-February pigs saved per litter. I would think that’s one of the reasons, and the under 50 pounds category, that fits with those. I would think these PRRS losses would be one of the reasons those look that way,” Meyer said.

Going forward and with the implied promise of higher prices due to lower supplies of pork, eyes will be on demand, domestically and globally. That front, too, looks hopeful, Mintert said.

“One of the positives coming out of this first quarter is the fact that the U.S. is apparently ahead of many other countries with respect to vaccinations and, perhaps, a return to more normal behavior on the part of consumers. I think there’s a lot of pent-up demand among consumers to get out, a lot of pent-up demand at the restaurant and institutional level. It’s going to be interesting to see how that plays out, but it’s going to be in an environment where the slaughter supplies and the pork supplies are quite a bit smaller coming into this report,” Mintert said.

Jeannine Otto

Field Editor