The most notable message in the March 27 Hogs and Pigs report from USDA is that pigs/litter have rebounded from the effects of PEDv. Pigs saved per litter, at 10.17, is a record for the winter quarter. The report confirms that market supplies no longer are tight.
The December-February pig crop was up 9.2%, a bulls-eye hit on the 9% average trade estimate. Perhaps more importantly it was 2.3% over 2013, a more normal year without the impact of the deadly virus. The reason: Pigs saved per litter, at 10.17, is a record for the winter quarter and well above the PEDv-reduced 9.78 pigs per litter of last year. In 2014, the summer pig crop bounced back to 10.16 per litter and in 2013 was 10.33. Given the recent quarter’s 10.17, it is clear the industry has learned to manage the disease.
The number of sows farrowing in December-February were up only 2.39% from last year and 1.47% from 2013, in keeping with the 2.2% increase in the breeding herd as of March 1. The trade was looking for 103.5% of last year. March-May farrowing intentions for an increase of 2% over both 2014 and 2013 also are in keeping with the size of the herd. By June-August, however, they are down 2% from last year, though still 1% above 2013.
USDA reports the inventory of all hogs and pigs, at 65.9 million head, down a touch from the prior quarter, but up 7% from this time last year. As the chart demonstrates, the big jump is because of last year’s crash, caused by the initial outbreak of the PED virus. Compared with 2013, this inventory is up 1.32%.
Each of the weight categories are well above last year and back to or above their 2013 levels. Most even exceed their recent peaks in 2008-09. Bottom line: The report confirms that supplies no longer are tight and while individual producers continue to have outbreaks of PEDv, it no longer is a market maker. It is not too surprising lean hog futures are down post-report.
For USDA’s complete report click here.