On Friday the USDA released the latest quarterly hogs and pigs report. University of Missouri-Columbia agricultural economist Ron Plain says that the report has good news and bad news.
"The good news is that farrowing intentions are coming in lower and the size of the pig crop lower than expected so kind of encouraging there," Plain said. "USDA is forecasting spring farrowings to be down 1% compared to a year ago where trade was expecting farrowing intentions in the spring to be up 1% so that is a positive sign."
Plain says that while the industry was expecting to see growth we may not see much.
"Another factor is that market hog inventory was a bit higher than expected when we look at the number of market hogs on the first day of December up 1.7% compared to a year ago," Plain said. "Trade was looking for those numbers to only be up 1.3%, so more hogs out there but less growth heading into 2012 than was we had expected."
Plain says more hogs are likely to go to slaughter this winter, which will pressure prices until the spring. He says though that for the second half of next year prices should be better because the expected expansion is not likely to happen. The concern was that a large expansion would press prices lower.
Something else that Plain noticed in the report was a drop in the number of pigs per litter this quarter. He says that could possibly be a result of the extremely hot weather this summer and we may see a bit of a dip in hog number this spring.
"For consumers we had several months of record high pork prices here in 2011," Plain said. "Prices in 2012 are probably going to come in on average pretty close to what we have this year. Not necessarily any higher, but right now it doesn't look pork prices in grocery stores are going to be any lower than prices we had this year."