US pig herd expansion comes as no surprise


By Joanna Levin

ATTRACTED by the availability of cheap feed, US pig producers have rapidly expanded their herds. This has produced expectations that a growing number of pigs will enter the market later in this year and early 1999.

The latest quarterly US Hogs and Pigs report, released on Friday, 25 September, shows that the total inventory has climbed 3% from 1997 to 62.9 million head on 1 September.

There was a jump in the number of finished pigs during the third quarter of 1998 to 26.3 million head, up 2% from 1997 and 11% from 1996. Looking ahead, US pig producers intend to farrow 3% more sows than in 1997 during the December 1998 to February 1999 period at 3 million sows.

The report had little impact on prices because the evidence of expansion came as no surprise to the market. The lean pig futures market had already plunged 60% from around 85¢/lb (75p/kg) in the spring of 1997 to a low of just above 35¢/lb (45p/kg) in August 1998. This was a reaction to the oversupply.

Prices have subsequently recovered, with the October futures contract closing on Tuesday, 29 September at 42.62¢/lb (55p/kg), up from 41.37¢/lb in the previous week.

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