The United States Department of Agriculture (USDA) released its quarterly Hogs and Pigs report Thursday.
Total inventory as of March 1, 2018 came in at 72.9 million head, up three percent from 2017. Market hog inventory totaled 66.7 million head, up three percent from March 1, 2017.
John Nalivka, president of Sterling Marketing, says the report’s findings came in close to pre-report estimate. He further adds, “positive returns are being seen within the industry.”
“It certainly follows through with the margins,” Nalivka said. “Producers made an average of $26 per head from January through February, and that’s a pretty good return. About a year ago, that return would have been about half of that. They’re following through with relatively low feed costs, both corn and meal on the protein side, and enjoyed sound returns through the first quarter until we got to March.”
Breeding herd inventory climbed to 6.2 million head, up two percent from 2017. Dan Bluntzer, New Frontier Capital (NFC) Markets director of research, says the March breeding herd inventory reached an all-time record.
Bluntzer adds Thursday’s report indicates expansion continues. However, he says USDA’s Prospective Plantings and quarterly Grain Stocks reports could have implications on the hog market.
“Some sort of weather market, (could) possibly put a slow on any expansion, depending on what those grain prices decide to do,” Bluntzer said. “Another market to watch would be the beef complex. Plenty of protein to go around for the foreseeable future.”
