In this weekly Commodities Watch column, John T. Barone, president and commodities analyst for Market Vision Inc., offers a snapshot of the state of commodities for restaurants.
The USDA said hog and pig inventories on March 1 were 1.5 percent above a year ago, and that the market hog inventory was 1.6 percent larger.
Most of the increase is in the heavier weight classes, which will be slaughtered this spring. That should prompt the USDA to raise its pork production estimates in this week’s WASDE report, particularly for the second quarter.
Pork output fell 1.4 percent in the first quarter compared to a year ago. However, March output rose 1.5 percent, and that kind of pace will likely be maintained in the second quarter.
Stronger pork output will come on top of slower exports sales that have already have taken a bite out of hog prices. Hog futures, at $80.03/cwt, have declined counter-seasonally from February’s high of $88.33.
Farrowing intentions for the balance of the year were close to 1 percent below year-earlier rates, but intentions could be reversed if corn prices decline and producer margins improve.
Contact John T. Barone at [email protected].