Sale weights for the first 3 weeks of August typically are 96.8% of early January sale weights in the Iowa-Southern Minnesota market. When I average the Iowa-Southern Minnesota weekly live weight at slaughter data (www.ams.usda.gov/mnreports/NW_LS720.txt) for the past ten years, sale weights begin their fall increase on week 33 of the year. By November 1, weights are back to January weights, and in some years higher than early January weights.
This week is week 33 of the market year and I expect to see weights begin their annual climb shortly. Unlike all of the previous 10 years, sale weights in this market this summer remain above 100% of the January weights. The reasons for this increase are many but include:
• more space in facilities due to PEDv induced shortages of pigs,
• cooler than normal temperatures (especially cooler than normal dew points in the upper Midwest)
• decreasing feed grain prices leading to heavier sale weights because of a lower incremental cost of gain
Nationally, the same lack of summer decline in weights is evident. Since July 1, the weighted 5 day rolling average weight of all barrows and gilts slaughtered under USDA inspection (www.ams.usda.gov/mnreports/ LM_HG201) has been between 213.05 and 214.09 lb. These are just below the 2014 week 1 average of 214.6 lb.
What will fall weights look like? The only sure bet is higher, but how much is what will really impact the supply side of the price equation. If we use the historic Iowa-Southern Minnesota weight increase, this suggests that the ‘average’ carcass weight in early November will be 220 lb. This is about 2.5 lb above the weights we sold in late April.
Last November we were only beginning to see the increase is sale weights that many have been talking about. Weights last November went to 213 lb in response to the large drop in cost of gain and climbed to 217 in late April. If we climb to 220 lb this fall, it will clearly break the trend of 1.1-1.2 lb/year increase in carcass weights that the US industry has been on since 1977.
I don’t know if we’ll get as much of a ‘bounce’ in weights this fall as normal years. We won’t have a rebound in performance due to less heat since heat has been less of a negative this year. However, I continue to hear of corn quality concerns from last years crop due to all of the harvesting and drying problems last all. We will begin feeding new crop corn in much of the upper Midwest in about 6 weeks.
In addition, producers have come to like getting a check for more than $240 per pig sold to slaughter. As prices fall, one way to keep gross income high is to sell heavier. Yes, the incremental cost of gain may say sell at a lighter weight in the face of falling prices but the size of the check still matters to many!