April 6

4/6 –The USDA’s March 26 Quarterly Hogs and Pigs Report was very bearish for hog prices. The number of market hogs on March 1 were higher than expected at 71.25M head, 4.3% above a year ago. Hog futures plummeted 39% post-report, from $65.85/cwt (3/25) to $40.23 on Friday (4/3). However, looking forward, the breeding herd (6.38M head) was lower than expected, up just 0.4% from last year. Additionally, planned farrowings for Mar-May are down 0.4%; Jun-Aug down 4.3%. That means large pork supplies through summer, followed by a slowdown from fall into early 2021. Demand uncertainty has producers pulling back. The potential for pork exports to China remains a huge wildcard, as does what will happen to U.S. pork demand in the wake of COVID-19. Hog futures are averaging $51.47/cwt for the 2nd half of 2020 and $62.04 for 1st half 2021.