The December USDA Hogs and Pigs report estimated all hogs and pigs on farms in the U.S. at 59.4 million head. The estimates in the report were very near the pre-report expectations and the report should be considered neutral to the market. The liquidation occurring in the industry can be seen in the market hog inventories.
All weight classes are below year-earlier levels.
Comparing the Iowa numbers with those of the U.S. shows that Iowa is liquidating its sow herd faster than the U.S., while all Iowa hog inventories are increasing compared with the decrease in the U.S. Table 2 shows inventory changes from December 1998 to December 1999. These numbers show the differences between Iowa and the U.S., but they are less pronounced than in recent years. Price Forecast Forecast prices for the coming year are expected to be at profitable levels for the first time since November 1997 . The expected decline in pork supplies, a strong economy, and a decrease in beef supplies starting in the second quarter will be supportive to hog prices. However, the driving factor behind current strength in hog prices and what the futures appear to have already factored into the market is demand .