North American Pig Inventory and Value

Today USDA and Statistics Canada released their joint report on the combined hogs and pigs inventory of the 2 countries. This is important since our industries are so closely linked. Not only do we have similar genetics, but Canadian producers ship approximately 90,000 weaned pigs per week to US production sites for growth to slaughter, 10,000 barrows and gilts to slaughter plants in the US and 8-9000 cull breeding stock to slaughter plants in the US. The weaned pigs show up in the kept for market inventory of US producers in the quarterly USDA Hogs and Pigs report, and the slaughter animals show up in daily and weekly slaughter numbers.

The US inventory was taken on September 1 while the Canadian inventory was taken on October 1. While not taken at the exact same time, the combined inventory estimate is still a revealing look at production trends in the leading export countries of the world.

The combined breeding stock inventory for Canada and the US stood at 7.114 million head, the highest since the December 2009/January 2010 number of 7.182 million. The kept for market (USDA number) plus other category (Statistics Canada number) was 71.475 million pigs. This was the largest inventory since the summer of 2009. The combined market inventory was 102.5% of the fall of 2010 number.

An interesting number to compute is the number of market pigs per breeding animal. For the 2 countries it comes out to 10.0 pigs per breeding female, the highest since I’ve been tracking the number, and most likely the highest on record.

This number is high for 2 reasons; 1) increased female productivity and 2) increased slaughter weights. This suggests that the demand for quality wean-finish and/or nursery-grow finish facilities will continue. With many producers having target sale weights of 290 lb or greater, depending on their packer matrix, it takes a lot of space to hold these numbers of pigs.

While pig owners are aware of the current economics of production, an interesting number for those of us that work with producers to keep in mind is the amount of money that the inventory of pigs in facilities represents. Yesterday’s average price paid for slaughter pigs in the Iowa and Southern Minnesota region was $86.25/cwt carcass weight. The average live weight for this market last week was 273.5 pounds. At a 75% carcass yield, this live weight becomes a 205 lb carcass valued at $176.81.

A typical facility in the Iowa and Southern Minnesota region holds 1000-1250 pigs per room/barn and it is quite common for a site to house 2450 pigs to slaughter. The value of this inventory if sold to slaughter today is $433,184.50. Earlier this summer when the sale price was in the mid $90’s/cwt, this was an even bigger number. As one owner told me one day – when we double stock a wean-finish barn at weaning, this represents almost $1 million dollars in sales 5 months from now.

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