UNITED STATES DEPARITEIT OF AGRICULTT.rRE
Bureau of Agricultural Economics
HS-24 October 18, 1938
T' H\ THE HOG SITUATION
--- Te seasonal increase in hog marketing now in progress probably
will continue during the next 3 months, reports the Bureau of Agricultural
Economics. Slaughter supplies of hogs during the'coming winter and spring
seasons will be larger than a year earlier. And for the new marketing
year, which began October 1, slaughter is expected to be larger than in
any year since 1933-34. Consumer demand for hog products in the 1938-39
marketing year, however, is likely to be somewhat stronger than in 1937-38.
The trend in hog prices has been downward since late July, and
prices declined fairly sharply in late September and early October. For
the week ended October 8 the average price of butcher hogs at Chicago was
$8.45 compared with about $9 in mid-September and about $9.65 in mid-July.
The drop in prices since July reflects chiefly the increase in marketing
of new-crop hogs. The market movement of such hogs got under way in
volume considerably earlier than usual this year. Ordinarily hog market-
ings in August or September are the smallest for any month of the year,
but supplies in July were less than in either Au.ust or September.
The annual hog outlook report will be released
by the Bureau of Agricultural Economics the first week
in Ilovtrmbr. This report, which will contain information
with respect to prospective trends in production and
prices of hogs, will be carried in full in the November
issue of the Hog Situation.
REVIEW OF EXCEPT DrEVELOr-ME'TS
Background.- The total live weight of hogs slaughtered
under Federal inspection in the 1937-38 marketing year,
which ended September 30, was somewhat larg-r than that
of the preceding year. Partly because of the increase
in supplies but largely because of weakness in consumer
demand the ovxr'iu- price paid by packers for hogs in
1937-38 of about $8.40 was about $1.75 lower than in
1936-37. Hog prices declined sharply in the first
quarter (October-December) of the 1937-38 marketing year
because of the weakness in demand and a lrgec seasonal
increase in marketing. From late January to early March
prices advanced seasonally and then trended downward un-
til late May. Frora late May to mid-July prices again
advanced, but declined fairly sharply from late July-to
Hog prices weaken in late September and early October
After str:engtheninr. somewhat in the first half of Sc:pt-b.-r, hog prices
declined sharply late in that month and in early October. The average price
of butcher hogs at Chicago for the week ended October 15 was .7.85, compared
with about $9 in mid-2-pt--mb-.r and about $9.65 in mid-July the highest weekly
average durin,- the summer.
In the past 2 months prices of light butcher lhoes have been somewhat
lower than prices of other butcher he-;:, :nd during September prices of heavy
butcher ho1s up to 300 pounds sold about as high as m-ndiu.: weight hogs. In
most of the past year the spread between prices of heavy butcher ho1-- and
medium weight ho;s has been relatively wide. The higher prices for heavy ho~-s
relative to lil:-ht hoes in the past several weeks probably reflects the increas-
ing rrorortion of light new-crop ho;s in the market supplies.
.!": ti.r.:-: in September lra-- r than in Auguist
Irnst.'.ted h:,- slaughter in -t timber, totaling 2,671,000 head, was some-
what larger than in Au;'Lust and 31 percent 1 -r "r than in S-pt -ember last year.
Ordinarily El :u.:-ht-r in A.:u.-t or S rt, .t r is the smallest for any month of
the year, but slaughter in July this ye:r was smaller then in either A.'jzuet or
3 rtcmbi r. T. lar'g r marketing in lA'i u.:t and C rt':.!:" than in July reflect
the unusually early market movement of srri:.' i.-; this year. The weakness in
hog prices since late July is du 1 v.'* ly to this increase in marketi;.,-s of new-
crop v ::.,
Mc, slau-.t.r under ? d-ral inspection in the 1937-75 -:-<: ti-..- year,
which :.d r t d about .6 million had, which -, t i bot .6 iiwas only
-',.O-,0 \ .r. larger then in -.i --.- 7. As the a. : .. -. weight of :.:-.,'-: ;l u.Tht .-red,
however, was :much huf~vi. r th l in !.24-:T, the total live weight of hois
slaughtered under F- ': ral infection in i.,.'"- was about 8 ,r :'-'t r'.r water
than in the p:' :*. i: m:lrku:ti' year.
- 2 -
October 1 pork stocks about the smallest on record
Although slaughter supplies of hogs increased during August and
September, all of this increase and more was reflected in the movement
of hog products into current consumption, as stocks of pork and lard were
reduced. Storage holdings of pork on October 1 were 17 percent smaller
than a month earlier, and they were about the same as on October 1, 1935,
when stocks were the smallest in the 23 years of record. Stocks of lard
were smaller than a month earlier, but they were somewhat larger than on
October 1 last year.
Storage holdings of pork and lard, specified dates
: 5-year average 9-
Date : 1929-30 to 1933-34: 195-36196-37 : iC 7-38
: Pork : Lard : Pork : Lard :Pork : Lard :Pork : Lard
: lMil. Mil. Mil. Mil. Mil. Mil. Mil. Mil.
: lb. lb. lb. lb. lb. lb. lb. lb.
Nov. 1 : 431 69 241 41 355 95 266 39
Jan. 1 : 565 72 327 53 667 146 399 54
Mar. 1 : 759 103 451 79 776 202 583 117
July 1 : 713 150 435 107 578 185 418 126
Sept. 1 : 605 135 421 111 368 118 335 117
Oct. 1 : 515 104 362 102 283 73 1/278 1/ 90
Fresh pork prices decline in late September and early October
Wholesale prices of fresh pork advanced somewhat during the first
half of September, but declined sharply in late September and early
October. The decline in prices in recent weeks has been greater for the
light cuts of fresh pork than for other cuts. This doubtless reflects
in part the increasing proportion of light hogs in the market supplies.
Wholesale prices of cured pork strengthened a little in September and
prices of lard were about steady. The average price of refined lard at
Chicago in September, however, was the lowest for any month in the past
August exports of pork and lard larger than a year earlier
Exports of both pork and lard in August were smaller than in the
preceding month, but they continued considerably larger than a year earlier.
Pork exports totaling about 6.5 million pounds were about 2 million pounds
larger than in August last year. Lard exports in Aupn.t amounted to 10.8
million pounds compared with 7.2 million pounds a year earlier. For the
first 11 months of the 1937-38 marketing year, Octobe r throu.h August, ex-
ports of pork were about 50 percent larger than in 1936-37, and exports of
lard were about twice as large as in the preceding year. Despite this in-
crease, exports are still considerably smaller than in the years prior to
- 3 -
Imports of pork in August totaled about 4 million pounds compared
with 6.8 million in Aurgust last year. Thus far in 1938 imports of pork
have been considerably smaller than in the corresponding period of 1937.
OCTT L D' K
The hog outlook has not clbrig-d materially during the past month.
Slaughter supplies of hogs in the 1938-39 marketing year, which began
October 1, will be considerably larger than in the previous year.
Seasonal changes in hog r)rketings
The seasonal increase in marketing now in progress probably will
continue during the next 3 months. The percentage increase in supplies
from September through January may not be as large as it was during that
period last year, as marketing of new-crop hogs got under way in large
volume earlier this year than last. In addition, the number of-old-crop
hogs on hand at the end of the summer this year was considerably smaller
than a year earlier.
In other years when the 1lo-_,- rn price ratio has been high and
hog sliu,:ht r has been considerably 1.r, r than in the previous year,
marketing in the second quarter (January-March) of the year have been
larger than in the first -u-rter (October-December). If this should be
the case in the present marketing year (1938-39), the seasonal reduction
in hog marketings in the l.te winter'and early spring probably will be less
Strn.-g: consumer demand expected in 1938-39
Consumer demand for meats for the 1938-39 marketing year is like-
ly to average strongr-r than in 1937-38. This prospect is uach different
from the situation prevailing in the preceding year, when consumer de-
mand weakened materially. Storage and export demand for hog products
this coming winter may be better than a -. :r earlier.
Annual Farm Outlook Report to be released in early Nover.ber
'. annual hoc outlook report, which is one of the several sections
c:' the r. -'1_r annual Agricultural Outlook report of the Bureau of AJ-ri-
cultural Economics, will be released in early November. This report will
cover the outlook and prospects for hoes durinI- the next year, -:.'5 it will
be .-i. in full in the November icsue of THE HOG SITUATION.
- 4 -
prices of hogs and hog products, specified periods
:1933 : to
Average price: :per 100:
Seven markets ........:pounds :11.10 7.00
Chicago ..............4 do. :11.37 7.76
U. S. average price
received by farmers... :
do. :10.55 7.01 0.07 6.43
Prices of hog products,
Loins, -10 lb. .....: do. :26.54
10-12 lb. ........: d.. :27.75
Bacon,snoked No. 1,
dry cured, 6-0 lb...: do. :33.95
H. W. tubs .........: do. :13.05
Average price of No.3 : Cents
yellow corn,Chicago,...:per lb.: 106
Hog-corn price ratio: 2/
Chicago ..*.........:Bushel :10.7
North Central States..: do. :11.3
21.04 22.22 17.07
23.15 23.75 20.31
25.40 25.25 23.71
0.97 0.91 9.60
54 53 62 74 115
11.6 14.1 9.2
12.9 15.0 9.4
Proportion of packing
sows in total packer
and shipper purchases,.... .- --..- -- -.
seven r.arkets 3/.......:Percent:29.0 33.0 22.0
Average weight at seven :
markets ............. :Pound : 240 264 241
16.o 15.0 13.0
pounds of live hogs.
1/ Not available,
2/ Numbor of bushels of corn equivalent in value to 100
3/ Monthly figures computed front weekly averages.
-- --- --'---
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UNIVERSITY OF FLORIDA
II6 11II 1111 lllllllllll i 111111 1lill 11111
6 3 1262 08861 7286
Supplies of hogs and hoC products, specified periods
:Aug. :July :Aug.
SUnit : :
:1937 :1930 :1930
~ : : .
37 : 30
Hog zl :70ih t or
Nu:.u! r : Thou-
slaughtered l/: sands
1,590 2,254 2,467 46,363 31,022 34,142 32,110 31,909
Average.....: Pound : 23
Total ..:.....Mil.lb. : 37
Dressed i.ci-ht :
Average : Pound 17
Total .......:Mil.lb. : 27
Yield of lard
per 100 pounds:
live eight of:
hogs ........a Pound : 9
lard .........:Mil. Ib,:
Apparent cons: :
ing lard 2/: do. : 4
Lard ........: do,
Pork ..........: do.
Lard .........: do.
Imports of pork / : do
260 245 231 232 221 220 234
525 604 10,723 7,191 7,530- 7,065 7,400
35 73 74 163.0 070
.0N 461 436 7,171 5,124
67 62 70 961 712
033 790 926
:-r.: :rtion of sows
sl1-..- hter /.....:Porcent :
60.4 50.6 51.2 51.9
51.1 50.0 49.9
1/ Bureau of Aniral Industry.
2/ .presents apparent disappearance of federally inspected pork plus unrondorod
3/ .United Status Departmcfnt of Co;:m;crco. Pork includes bacon, hans a:td shoulders,
and fresh, canned, and picli:l pork. Lard includes neutral lard.
/ Includes -ilts.