Iowa Farmer Today
04-07-07
No surprise, hogs are good
By Jeff DeYoung, Iowa Farmer Today
No surprises were revealed in this past week’s USDA Hogs and Pigs Report, and most in the industry would say that’s just fine.
Shane Ellis, Iowa State University Extension livestock marketing economist in Ames , says while the March 30 report indicates the U.S. breeding herd is slowly growing, it’s doing the exact opposite in Iowa.
“We’re still expanding nationally, although not so much locally,” he says. “But, we are seeing in Iowa is an increase of market hogs with a lot of those coming from
Canada. Even with higherpriced feed, it’s still cheaper to feed pigs here than anywhere else.”
Overall, the national inventory was up 1.3 percent from a year ago with the breeding herd rose less than 1 percent. Market hog numbers were up nationally by 1.3 percent from a year ago.
Iowa’s total inventory increased 1.2 percent from a year ago, while breeding herd numbers decreased by 1.8 percent. Market hogs were up 1.4 percent. The report also indicated the September-November and December-February pig crops would be up 1.6 percent nationally.
Despite the small increase in the national breeding herd, Ellis says producers continue to increase the number of pigs farrowed per sow, which contributes to the market hogs increase.
“These producers are in the business of being more efficient, and they keep increasing not only the number of pigs per litter, but the number of pigs that are staying alive per litter,” he says.
Ellis says the steady expansion indicates some optimism in the hog industry. He says Iowa producers may be choosing to err on the side of caution and are not expanding the breeding herd.
“I think producers are unwilling to take on the risk and expense of expanding their farrowing operation.”
He says producers are choosing to feed hogs instead, perhaps expanding their finishing capacity as more pigs come in. The report indicated a 9 percent increase in the import of Canadian feeder pigs so far this year. Demand for hogs

and pork is still strong. With that in mind, Ellis is forecasting a $49 to $52 per hundredweight live price average in the second quarter and an average $52-
$55/cwt. in the third quarter. Fourth-quarter price averages will fall to $46-
$49/cwt. and hold that level through the first quarter of 2008.
“Barring any problems with corn, we should be profitable through the end of the summer, and at least break even the rest of the year,” Ellis says.
He says fed cattle prices continue to be strong, adding the U SDA’s recent planting intentions report should help feedlots.
“We’re growing a lot more corn, and that’s good news for these guys. They are going to be paying as little as possible for feeder cattle, so we may see some profitability in the cattle feeding industry.”