DES MOINES, Iowa — Next month will mark the 34th consecutive month that U.S. pork producers are expected to break profit records with Iowa having a record number of consecutive profit months – and the largest hog numbers in 51 years.

“(This) report came in relatively close to expectations or a little larger,” said Steve Meyer, president of Des Moines-based Paragon Economics and industry consultant with the National Pork Producers Council in Urbandale, Iowa, at a news teleconference about the USDA’s Quarterly Hogs and Pigs Report, released Sept. 29.

Among the analysts that discussed the USDA report were Victor Aideyan, senior risk management consultant at Farms.com Risk Management in London, Ontario; Glenn Grimes, extension livestock marketing economist at the University of Missouri in Columbia, Mo.; and Len Steiner, president of Steiner and Co. in Manchester, N.H. According to the report, the U.S. inventory of all hogs and pigs on Sept. 1 reached 62.7 million head, up 1 percent from Sept. 1, 2005 and up 2 percent from June 1.

The USDA said, as of Sept. 1, there were 16.9 million hogs and pigs on Iowa farms, which is up 2 percent from 2005 and more than 2 percent from June 1. This was the largest number of hogs and pigs since September 1955 when 17.2 million head were raised on Iowa farms, and the third largest Iowa hog inventory since estimates were first taken in 1866.

The breeding inventory rose to 6.08 million head, up 2 percent from last year and up slightly from the previous quarter.

The USDA also said the market hog inventory reached 56.6 million head, up 1 percent from last year and up 2 percent from last quarter. The latest Iowa State University (ISU) livestock statistics indicated that the last 10 years have been profitable for farrow-to-finish Iowa hog farmers, with average returns of $2.50 for each hog sold.

As long as current demand remains steady, Grimes said prices for live hogs would range from $44-$48 per cwt. in the coming fourth quarter; $42-$45 in the first quarter of 2007; and $47-$50 in the second quarter of 2007.

Steiner said he projected prices at the carcass basis to be $64 per cwt. in the fourth and first quarters, and near $70 in the second quarter of 2007. He added that the key to maintaining higher prices would be exports.

Because of the exchange rate, Aideyan said there were 15 percent more young feeder pigs coming into the Midwest from Canada for finishing.

Currently, the Canadian hog market is shrinking and its hog slaughter is 3-4 percent lower than 2005, while U.S. hog slaughter is up 1 percent.

But Aideyan added that Canada would supply about 8.2 percent of all hogs going through U.S. meat-packing plants by the end of this year.

“The winners are going to be U.S. packers,” he said. But since the value of the U.S. dollar, compared to the Euro, continues to weaken, U.S. pork prices are going to become more competitive, Steiner said.

“So far, there’s no real market incentive to stop it,” he said. “When you start running into something that’s been here every year for a decade and a half, you kind of have to scratch your head and wonder why you want to bet against that trend.”

The USDA said the June-August 2006 pig crop of 26.7 million head was up 1 percent from 2005 and up 2 percent from 2004.

Sow farrowing totaled 2.92 million head, which was up slightly from 2005, up 1 percent from 2004 and represented 48 percent of the breeding herd.

The average number of pigs saved per litter was 9.14 for the June-August 2006 period, compared to 9.06 in 2005. Pigs saved per litter by size of operation ranged from 7.70 for operations with 1-99 hogs and pigs to 9.20 for operations with more than 5,000 hogs and pigs.

The USDA added that U.S. hog producers intend to fallow 2.92 million sows during the September-November 2006 quarter, up 1 percent from the actual farrowings in both 2005 and 2004. The report also said intended farrowings for December 2006-February 2007, at 2.90 million sows, are up 2 percent from both 2006 and 2005.

The total number of hogs under contract, which are owned by operations with more than 5,000 head but raised by contractees, accounted for 39 percent of the total U.S. hog inventory, unchanged from last year.

USDA Secretary Mike Johanns said all inventory and pig crop estimates for September 2005 through June 2006 were reviewed using final pig crop, official slaughter, death loss and updated import and export data.

Published since 1968, the USDA quarterly report is issued four times a year and presents data on the U.S. pig crop for 17 major pork-producing states, including inventory numbers by class, weight group and the value of hogs and pigs, farrowings and farrowing intentions.

This farm news was published in the Oct. 4, 2006 issue of Farm World, serving Indiana, Ohio, Illinois, Kentucky, Michigan and Tennessee.