2002 03 Hog Market Situation and Outlook Presented

2002 -03 Hog Market Situation and Outlook Presented by John D. Lawrence and Gary May Iowa State University

Current Events • Russian Poultry Ban • Japanese Pork Safeguard Tariff • Biggest August slaughter in history • Supplies larger than expected. Why? • Plant capacity and Hormel announcement • Country of Origin Labeling

Meat Supply Year-To-Date Sept 27, 2002 • Red meat production +3. 4% – Beef +3. 7% – Pork+3. 2% • Poultry production +1. 0%

Meat Demand • Domestic demand steady-strong • Export demand Jan-July – Beef +11. 0% – Pork-1. 0% – Broilers -16. 3% • Russian poultry ban – In 2001 broiler exports to Russia equaled total US beef exports

Sept. 1 Hogs and Pigs Inventory All Hogs Breeding Herd Market Hogs Under 60 60 -119 120 -179 180 + Mil Hd 60. 22 6. 05 54. 17 19. 68 13. 41 11. 15 9. 93 % Chg +1. 2 -1. 7 +1. 0 -1. 1 -0. 2 +2. 7 +5. 4

Sept. 1 Hogs and Pigs Inventory Mil Hd % Chg Pig Crop Mar-May 25. 85 1. 3 Jun-Aug 25. 13 -1. 6 Farrowing Intentions Sep-Nov 2. 82 Dec-Feb 2. 81 -2. 5 -1. 1

Up 16. 5% June-August

Production and Price Forecast Quarter Oct-Dec Jan-Mar Apr-Jun Jul-Sep Pork Supply 4% -1% -1% Price Forecast $27 -30 $35 -38 $37 -40 $42 -45 1 in 6 Price $24. 25 $30. 00 $31. 50 $34. 75

Factors to Watch • • • Weekly slaughter Does the report track? Plant capacity Marketing weights Sow slaughter Feed costs

Web Site Tools www. econ. iastate. edu/faculty/lawrence • • Iowa Farm Outlook Historic Basis Future and Options Calculator Futures and Options research