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UNITED STATES DEPARTMENT OF AGRICULTURE
Bureau of Agricultural Economics
HS-10 August 18,1937
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THE HOG SITU ACTION
S alauiiter supplies of hogs probably will increase seasonally during the
fall months as spring pigs begin to be marketed in fairly largo numbers. The
seasonal increase in cupjlies from October through December, however, may be
less than usual since it now seems fairly certain that the 1937 corn crop will
be much larger than that of last year, and probably larger than aver...c The
larger supplies of feed and higher hog-corn price ratio probably will cause pro-
ducers to feed hogs to heavier weights and thereby delay marketing.
Although the seasonal increase in hog marketing this fall is likely to
be less than usual, the storage demand for hog products will not be so strong as
that of last fall. It is probable, therefore, that the seasonal decline in hog
prices in the fall and early winter will be of about average proportions.
Hog prices advanced further during late July and early '.ugust,as slaughter
supplies were reduced to avery low level. The top price of hogs at Chicago in
the first week of August reached $13.75, the highest price paid at that market
| since October 1926. Since early May, prices of butcher hogs have risennearly
$3 per 100 pounds.
With production of corn and other feed grains about average this year, the
supply of feed grains per head of livestock on farms will be larger than for
several years. By late fall or early winter it is expected that the hog-corn
price ratio will be relatively favorable for hog production. This will doubtless
cause the 1938 spring pig crop to be considerably larger than the small spring
crop of this year.
REVIEW OF RECENT DEV7LCP7lE! TS
B/.Ci:GRiD Hog prices advanced somewhat from late
November to early January, but from February to early
May there was little change in prices. In the latter
period the C'i.cago weekly rverag: pric3 fluctuated with-
in narrow limits around $10 per 100 pounds. In the
last half of May hog prices advanced sharply as slaughter
supplies were materially reduced. Because of the
reduction in feed supplies brought about by the drought
of 1936 corn prices have been high in relation to hog
prices in most of the present maLketing year. In: arch
and April the hog-corn price ratio was near the lowest
on record for that season of the year. In the first 7
months cf the present marketing year, October thr.?.'h
Ai:ril 1536-37, hog slaughter was considerably larger than
that of 1935-36, although smaller than average. The
increase in storage stocks of hog prodcJcts from October 1,
1936, to Mvarch 1, 1937, was greater than usual, and in
the early spring such stocks were much larger than a year
earlier and larger than average.
H9 oprice2s rc-ch hil h st level in 11 years
Prices of hogs advanced further during late July and early August, as
supplies were reduced from the low level of May and June. During the first
week of August the top price of hogs at Chicago reached $13.75, the highest price
paid at that market since October 1926. For the entire month of July the average
price of hogs at Chicago was $11.57, compared with $11.04 in June and $9.76 in
July last year. Since early May, prices of butcher hogs have advanced nearly
$3 per 100 pounds.
July hog slaughter smallest since 1896
Inspected hor slaughter in July, totaling 1,643,000 head, was 22 percent t
smaller than in June and was the smallest slaughter for July since 1 -6. For
the 3 months, :.~y, June and July, inspected slaughter of hogs to-alced
5,852,000 head, about 27 percent fewer than in the same months of 1936 and
only slightly more than the very small n-ujber slaughtered in the correscnding
months of 1935. The short supplies of hogs this summer were brought about
by the marked decrease in feed crops in 1936 resulting from the irou;-ht of
last year. Similarly, the small slaughter in the summer of 1995 was an outcome
of the severe drought of 1934.
The short sup;~lies and high prices of fcd grains earlier this year caused
marketing of a large number of fall liis to be earlier than usual and also
resulted in the holdnr.g of hogs on pasture for firislhir,; on the new cror of
small rains and the new crop of corn. Both .f these factors have bcon reflected
in the small slaughter supplies during, the past 3 months.
The proportion of packing sowJs n the total hog marketing were:
seasonally larger in July than in Junei '"At the seven leading markeesj '
however, the proportion which packing sows represented of total eee6ipts
in July was about the same as in the corresponding month last year, Oareas
in May and June this proportion was larger than a year .earlier. BetatUe of
the small total slaughter in May and June the actual number of packing sows
marketed probably was little different from that of the cdrrespondifg month'
of 1936. Considerably fewer packing sows were marketed in July. :however;
than a year earlier.
Although the June pig crop report indicated, that the numnbr.Of. $owQ t
farrow next fall would be about 3 percent smalledf than"a year esriler, it 'is
possible that the continued favorable corn crop pxfspeots sinoe jiua add the
lower corn prices in relation to hog prices will rb~ult in larger fall
farrowings than was indicated by the report on breei4g intentions- about Jung
1. The smaller marketing of packing sows in July than a year earlier may
indicate a tendency on the part of producers to rAtain more sows f af, all
farrow than they intended, earlier in the summer.
HogfEcorn price ratio increases
With the continued favorable crop prospects- market prices of born
declined steadily since early May, with a sharp decline in the last'half of
July. The average price of No. 3 Yellow corn at Chicago for the first 'week o6
August was $1.18 cents per bushel, compared with $1.38 in early May.u The hog-.
corn price ratio, based on Chicago prices, was 11.1 ?n early August, compared
with 7.4 in early May and 8.9 a year earlier. The average ratio between
hog prices and corn prices at Chicago over a long period of years is about
Wholesale prices of all hog products advanced during the last half of
July. Prices of fresh pork at Chicago in late July and early August W&~e
the highest since late 1926. Prices of cured pork in late July were higher
than at any time thus far in the present marketing year, but they were
slightly lower than prices prevailing in the summer of 1935. Although lard
prices advanced slightly in late July, they were somewhat lower than prices
of last January and early February. The failure of lard prices to advance
much in the past 2 months, when supplies of hogs have been short, probably is
due chiefly to the large supply of cottonseed oil in prospect from this yearOks
Stocks of hogproduots decline sharply in Jul
The very small slaughter of hogs in July was accompanied by a consider4-
reduction in stocks of pork and lard during the month. The reduction in porK.,
stocks during July was much greater than usual. Stocks of lard usually inqaicr
during July. On.August 1 stocks of pork, totaling 469 million pounds, were,
about 19 percent smaller than on July 1, but they were 6 percent larger than.
a year earlier,, Storage holdings of lard on August 1, amounting to 157 millUoo
pounds, were 15 percent smaller than on July 1, but they were about 34 percent;
greater than the stocks on August 1, last year. Last summer, however, stooks
of both pork and lard were much below average.
The increase in stocks of pork and lard during the winter months 'wa'e
considerably greater than usual, .and at the beginning of March stocks of t
pork were morethan 70 percent, or about 300 million pounds, larger than a
year earlier, while lard stocks were more than twice as large as on March 1,
1936. The increase in storage stocks of hog products on March 1 over a year
earlier was equivalent to the products obtainable from about 2,800,000 hogs
of average market weight. With the very small-hog slaughter in May, June
and July, stocks of hog products were reduced sharply in those 3 months.
On August 1 the increase in stocks over a year Cerlier was equivalent to
the products obtainable from less than 500,000 hogs of average market weight.
Storage holdings of pork and lard on August 1, average 1930-34,
annual 1935-37 and July 1, 1937
:Aug. 1 : Aug. 1,
:average Aug. 1, Aug. 1,.July 1, 1937
Item :1930-34 : 1935 1936 1937 : /
: 1,000 1,000 1,000. 1 ,o00 1,00
: pounds pounds poupr.j pounds pounds
Frozen ............ 131,307 83,119 95,941 203,595 144,910
Dry salt, cured
and in process
of cure .........: 126,346 61,231 93,675 81,719 75,047
and in process
of cure ........: 383,986 225,560 252,345 293,110 248,941
Total........: 691,639 369,910 441,961 578,424 468,898
Lard ............... : 158,131 68,135 117,026 185,124 157,382
Exports of lard irnc -a.L, but pork exports continue small
L:xciports of lard have increased somewhat during the past 3 months, but
there has been little change in 'ork- experts. In the first 9 months of the
present marketing year, October through June 1936-37, exports of lard totaled
about 81 million pounds, which was slightly larger than the quantity exported
in cori-cspondiin period of 1935-36, but much smaller than in other years.
During those 9 months Great Britain was the leading imp-rter of United St.ates
lcrd, although exports to that country were slightly sumller than in 1935-36.
Exp.-rts of lard to Cuba thus far in 1936-37 were somewhc.t larger than a year
earlier. The two countries, Great Britain and Cuba, have taken more thin
85 pLercrnt of the United States lird exports in the current marketing ycAr.
Exports of pork in the first 9 months of 1936-37 totaled about 45:'illiinl
pounds, wtich was slightly smaller than a year earlier and the smallest in
many years, Shipments of hams and shoulders to Great Britain represented
about halt of the total pork exports this year.
'Pork imports continue larger than a year earlier
Imirrts of pork increased during June after having been reduced In April
and May. ;A in the months from December through March 1936-37, pork imports in
June exceedd exports. In the first 9 months of the present marketing year pore
imports t6tealed about 51 million pounds, andwero the largest for the period on
record. Sports of live hogs also have been larger thus far in 1936-37 than
in 1935-3,.- Total imports of both hogs and pork, however, are still very small
in relation to domestic production. In the period from October through June
1936-37 t4e combined imports of pork and live hogs were roughly equivalent to
only about 530,000 hogs of average market weight. In this period hog slaughter
under Fed-il inspection totaled 28,877,000 head.
Hog numbed in Germany in earl June large
The total number of hogs in Germany in early June was reported to be
.slightly lArger than a year earlier, and the largest for this period of year
on record.., All of the increase over a year earlier was in slaughter hogs
!2 months .d;i~nd over. The, number of pigs less than 2 months old was 5 percent
-smaller thEn a year earlier, and the number of bred sows was 15 percent smaller.
:On the ba~ b :of numbers on hand at the beginning of June, it is expected that
hog slaUght;er in Germany during the coming fall months will be larger than that
of last f4al. With fewer numbers of young pigs and bred sows, the number of
hogs in Getiany in late 1937 probably will be smaller than a year earlier, and -
Shog slaughter in the first half of 1938 may be smaller than in the corresponding
period of this year.
BACKGROUND Prospects for slaughter supplies and
prices of hogs in 1937-38 were stated in the July
issue of this report as follows:
(1) The number of hogs to be slaughtered in
the coming marketing year, which begins October 1,
will be somewhat smaller than that of the current
marketing year but probably larger than in either
of the 2 previous marketing years.
(2) Average weights of hogs slaughtered in
the 1937-38 marketing year are likely to be some-
what heavier than in the current year. The expected
increase in weights will offset in large part the
probable reduction in numbers slaughtered.
(3) With much larger supplies of feed in
prospect for 1937-38 than in 1936-37 and with hogs
being fed to heavier weights, it is expected that
the seasonal distribution of hogs mark1.'.in, during
1937-38 will be much different from that of the
present year. Slaughter during the first 3 months,
October through December, will comprise a relatively
small proportion of the yearly total and also of
the total for the first half of the year.
(4) With prospects for .a slightly smaller
tonngre of hogs to be marketed in the f:ll armed
winter of 1937-38 than a year earlier and for the
maintenance of a fairly high level of consumer
demand, hog prices in this p-.ricd probably will
average as high as and perhaps higher than in 1936-37.
Slaughter supplies of hogs probably will increase seasonally after
September, as spring pigs begin to be marketed in fairly large, numbers. There
also may be a considerable number of hogs from the 1936 fall pig crop marketed
during the October December period, since firaihing of such pigs in some
areas was delayed until the new crop of small grtins became available this
summer. The seasonal increase in hog slaughter from October through
December, however, may be soueewhat less than usual since it now seems fairly
certain that the 1937 corn crop will be at least equal to avr.rge and lirger
than in any year since 1932. The lower corn prices and the higher hog-corn
.price ratio doubtless will cause producers to feed hogs to heavier weights and
'thereby delay marketing. Inspected slaughter during this period (October
to December) probably will be l.-xsgr than in corresponfcing mf-nths of 1935,
when conditions werc somewhat similar, but considerably smaller than in 1936.
The proportion of the slaughter for the winter season which is marketed
from J:nua:-.ry thrcu,h March is expected to be considerably larger than that
marketed from October thr,-ugh' December. In most recent years the proportions
marketed in these 2 periods have been about the same.
On the basis of probable changes in marketing alone, it would be
expected that the seasonal decline in hog prices after A.\-ut or Soete:-ber
would be somewhat less than average, since the increase in supplies during the
fall months will be much less than average. Changes in narkctii-.s in this
period, however, are net always the principal factor resulting in seasonal
changes in hog prices. In 1936 'ohen the increase in supplies front September
to Deoecber was fairly largo, the decline in price was small, ancunt-rin to
less than 50 cents per 100 pounds on butcher hogs. It sees probable that the
Ltror,- demand for hcg products for storage in late I?3'' r-~v
apparently w.s caused by the prospFcts for a marked decroaso in supplies and
a considerable advance in prices of ho, products later in the present nirketin,
In late 1937 the storage deiond for hog products is rot expected
to be so strong as a year earlier, since supplies of hogs in the remainder
of the 1937-38 marketing year are expocter to increase rather than decrease.
It is probable, therefore, that a seasonal decline in prices of about normal
proportions will occur during the co'mLrz fall and early winter. The decline
in prices, however, may continue later trn usurl and may occur m-stly after
November, whereas it is usually completed by mi.-Dccenber. A considerable
increase in hog marketing may occur during late Decoeber and January, and
the decrease in marketing in the late winter and early spring ioay be
less than usual.
It is now expected that production of feed grains this year will be
equal to or above average, and will be much larger thL.n that of last year.
The supply of feed grains per head of livestock in the 193'-38 feeding
season probably will be largest in several years. Prices 01 corn in the
important hog-producing States will be much lower in 1937-38 than in
1936-37, and the hog-corn price ratio in 1937-38 will be favorable for
hog production. Under such conditions it is probable that the 1938 spring
pig crop will be materially larger than that of this year. A corn crop
of about average size in 1938 would further stimulate hog production. A
srd:-ession of average or near-averago corn crops in the next few years
probably would result in a marked upswing in hog production and slaughter
fTrm the present low levels.
Supplies of hogs and hog products, specified periods
SOct. Seot. : Oct. June
: : : : Averag: :
:June : May :june :1928-29:1934- :1935- :1935- :1936-
:1936 : 1937:1937 : to : 35 : 36 : 36 : 37
Inspected : thou- :
slaughter _/....: sands :2,739
Avera'- .......: pound : 242
*.'.-ra e ....... pound : 183
Yield of lard pr :
100 pounds live
weight of hogs...: pound : 13.2
46,363 30,680 31,022 23,673 28,877
175 164 175 174 165
8,069 5,012 5,402 4,105 4,674
15.2 11.6 12.1 12.2 11.3
reduction of lard:mil.lb.:
Lard..... ......: n :
Lard ..........: "
Imports of pork 2/: "
Proportion of sows:
sl:.! .r:'ht..r 3/.... : percent:
87 51 52 1,630 790 870 663 713
4 6 8
7,171 5,102 5,124 3,778
961 730 712 522
6 7 32 22 52
56.4 51.2 51.3
52.0 48.4 49.8
1/ Bureau of Animal Industry.
2/ United States Dpr rtment of Commerce. Pork includes bacon, hams and shoulders
and fresh, canned and pickled ;-ork. Lard includes neutral lard.
3/ Includes gilts.
Prices of hogs and hog products, specified periods
:: Oct. S.pt. : Oct.- July
:A .' r' :o* : 0
Item : Unit July :June :July :19?6-29:1934-:1935-:1935- :1936-
:1936 :1937 :1937 : to : 35 : 3 : 36 :37
S: : 192-33:
: dolls. :
Seven markets .. : lb.
U. S. average price
received by farmers: "
Prices of hog
Loins,8-10 lb. ..:
:Io.l, 10-12 lb. :
Bacon, smoked,No. 1:
dry cure,6-8 lb.:
H.W. tubs ......:
price of hog
products,New York..: "
: 9.30 10.84' 11.37
: 9.76 11.04 11.57
9.14 9.97 10.70
:21.15 24.40 28.66
:26.98 25.42 26.78
:30.17 28.45 29.91
:12.10 13.25 13.62
:21.35 21.53 22.78
6.48 7.54 9.15
17.07 20.06 21.21
20.31 21.62 26.58
23.71 28.24 30.86
9.68 14.29 12.65
17.36 20.49 21.93
..'vcr-r price of
No.3 Yellow corn, :cents per:
Chicago ...........: bush.
Chic-go ......... :bushel
86 122 118 62 86 74 66 117
11.4 9.0 9.8
11.6 9.9, 14.1
12.0 9.1 9.5 12.9 10.0 15.6
Proportion of packing
sows in total
packer and shipper :
markets 3/..........:percent :36.0
l/ L/ 16.o
Average weight at :
seven markets .....: pound
: 258 249
1/ 229 241 240 227
/ Not available.
/ Number of bushel of corn equivalent in value to 100 pounds of live hcgs.
_/ Monthly figures computed from weekly averages.
llllll3 1262 08861 lI7567
3 1262 08861 7567
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