Feeder Pig Prices

I’ve been tracking weekly weaned and feeder pigs prices from USDA for almost as long as they have been reporting them at the following site:
www.ams.usda.gov/mnreports/NW_LS255.txt

There has been a clear seasonal cycle to the pricing of these pigs. For example, since 2005, the yearly highest price paid in the spot market for weaned pigs has always occurred in January and February. This makes sense since the supply of weaned pigs is lowest at this time of year due to seasonal infertility problems the previous summer. The expectation is also for sales of these pigs in relatively high summer markets. On the other hand, the lowest price typically occurs in July and August because of the abundance of weaned pigs and the expectation of sales during the yearly cycle low in prices.

Patterns for 40 lb feeder pigs have a similar cycle, but shifted about 1 month to reflect their one month advantage in days to slaughter.

This year it appears that we can forget about cycles due to the on-going shortage of pigs due to PED. The yearly high so far in weaned pigs occurred in late March (cash price for weaned pigs averaged over $90/pig for 2 weeks then) with those pigs going to market in August. Feeder pigs peaked above $135/pig for 3 weeks in mid-April, again with the pigs going to market in late July.

In the last couple of weeks weaned and feeder pig prices have rebounded once again. Weaned pigs placed in facilities this week will go to market in mid-late November, a period that historically has the lowest yearly prices.

Clearly the buyers of weaned and feeder pigs are placing their bets on a strong fall market, contrary to historic tendencies. Another reason every is waiting for next weeks’ Hogs and Pigs Report. What will the number look like for fall sales?

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