DES MOINES, Iowa – Last month’s hog numbers were bullish – especially for the second half, according to one agricultural economist analyzing the March 1 USDA Quarterly Hogs & Pigs Report.

“I thought we would move back to a little bit of growth in the breeding herd perhaps, and I was expecting substantial growth in year-over-year growth in pigs per litter and farrowings per breeding animal,” said Steve Meyer of Partners for Production Agriculture in Ames, Iowa.

“The USDA says we’re not going to get that, and if that’s the case, then these numbers are going to continue to stay tight and demand is excellent,” he added.

Meyer joined Altin Kalo of Steiner Consulting in Merrimack, N.H., and John Nalivka, president of Sterling Marketing Inc., in Vale, Ore., to analyze the report in a March 30 teleconference with reporters.

Sponsored by the National Pork Board and the Pork Checkoff in Des Moines, Iowa, the report said United States inventory of all hogs and pigs on March 1, 2022, was 72.2 million head, down 2 percent from March 1, 2021, and down 3 percent from Dec. 1, 2021.

The report said U.S. breeding inventory, at 6.1 million head, was down 2 percent from last year, and down slightly from the previous quarter.

“At this point, the breeding herd is down 6.9 percent from its peak on Dec. 1,” Kalo said. “Before the USDA’s report was published, March 1 inventory was expected to be 5.2 percent lower than the 2019 peak.

“We don’t know gilt retention, but one way to come up with an estimate is to look at the starting and ending inventory of the breeding stock for the quarter, and imports and slaughter during the quarter,” he added. “Using that approach, we think that gilt retention during the December-through-February quarter was down 13.5 percent from the previous year.”

The report also said U.S. market hog inventory, at 66.1 million head, was down 2 percent from last year, and down 3 percent from last quarter. The December 2021-February 2022 pig crop, at 31.7 million head, was down 1 percent from last year.

The report said the revision made to the December 2021 all hogs and pigs inventory was 0.1 percent; the net revision made to the September 2021 all hogs and pigs inventory was 0.6 percent; and a net revision of 0.1 percent was made to the June-August 2021 pig crop.

“There are very few revisions and not very large revisions to this report, which did not surprise me that the slaughter numbers have fit the USDA’s reports the last couple of quarters,” Meyer said.

“We’re kind of through all the year-over year, screwy numbers they’ve been giving us because of coronavirus and pig backups,” he added. “I think we have a pretty good baseline to compare numbers to in this report.”

The report said sows farrowing during this period totaled 2.9 million head, down 1 percent from previous year. The sows farrowed during this quarter represented 47 percent of the breeding herd.

The report said the average pigs saved per litter was 10.95 for the December 2021-February 2022 period, compared to 10.94 last year.

“We had kind of shifted back to growth in the last quarterly report, plus 1.3 percent,” Meyer said. “We had gone through a period with the COVID-19 shutdowns, where we made decisions to not raise as many pigs per litter.

“But we’ve got a genetic capability out there that I think could be better than this, but the USDA is finding that we didn’t do that very well and we didn’t really improve that much in this quarter, relative to a year ago,” he added.

The report said Iowa hog producers accounted for the nation’s largest inventory among the states at 23 million head. 

The report said Minnesota had the second largest inventory at 8.6 million head, and North Carolina was third with 8 million head.

In Illinois, total inventory of all hogs and pigs on March 1 was 5.2 million head, down 3 percent from Dec. 1, 2021, but unchanged from last year. In Indiana, total hog and pig inventory was estimated at 4.15 million head, down 150,000 head from a year ago. In Michigan, total hog and pig inventory was estimated at 1.18 million head, down 110,000 head from a year ago. In Ohio, total hog and pig inventory was estimated at 2.6 million head, up 100,000 head from a year ago. 

The report also said United States hog producers intend to have 2.99 million sows farrow during the March-May 2022 quarter, down 2 percent from the actual farrowings during the same period one year earlier, and down 5 percent from the same period two years earlier. 

The report added intended farrowings for June-August 2022, at 3.03 million sows, are down 1 percent from the same period one year earlier, and down 7 percent from the same period two years earlier.

Nalivka said the March 1 report continues to show there is no incentive to expand hog numbers.

“Going back to 2017, producers began a rapid expansion due to two reasons: new capacity was being built, and growing export demand largely driven by China following African swine fever,” he said. 

“Then, when COVID-19 hit the industry in 2020 and processing capacity was slowed significantly, the industry was severely disrupted and losses were significant,” he added.

He said this situation will now drive producer decisions concerning herd expansion or contraction.

“Producers have had to adjust to significantly changing economics over the past two years,” he said. “This is the path going forward.”