June 28

6/28 - Last week’s quarterly USDA Hogs and Pigs report showed some improvement in hog numbers, but also indicated tight supplies for the balance of the year. June 1st hog inventories at 75.7M head were up 1.0% from March 1st - but herd numbers are still down 2.2% from a year ago and the March/May pig crop was down 3.1% from last year. Farrowing intentions for June/Aug are down 4.4% and intentions for Sept/Nov are down 1.8% compared to last year. Lean hog futures that were $66.30/cwt in mid-January, soared 85% to hit highs of $122.88 on June 14, before falling back to $101.95 (6/25) as July 4th buying began to ease. Second-half 2021 contracts are averaging $90.85/cwt. But this report indicates that slaughter will be lower than expected for Q4, while domestic demand for pork remains strong and China looms (as always) as a huge wildcard for exports in 2021/22.