DES MOINES, Iowa – There were no surprises in the Dec. 1 USDA Quarterly Hogs & Pigs Report – especially with hog numbers falling within one percentage point of pre-release trade predictions, according to agricultural economists analyzing this final quarterly report of 2022.

However, the U.S. swine breeding herd increased, the USDA said.

“At 98 percent, the market hog inventory was 0.4 percent smaller than expected, while the breeding herd, at 100.5 percent, was 0.8 percent larger than trade forecast numbers,” said Ron Plain, University of Missouri professor emeritus of agricultural economics.

He added, “This is a slightly bullish report. The Dec. 1 hog inventory is the lowest since 2016.

“The market hog weight group inventories as a percent of last year were: 180 pounds and up 98.1 percent; 120-179 pounds 98.1 percent; 50-119 pounds 98 percent; and under-50 pounds group at 98 percent of the year-ago level,” he said. “If these numbers are correct, hog slaughter will be down 2 percent over the next five months.”

Released Dec. 23, and sponsored by the National Pork Board and the Pork Checkoff in Des Moines, the report said, as of Dec. 1, there were 73.1 million hogs and pigs on U.S. farms, down 2 percent from December 2021, and down 1 percent from Sept. 1, 2022.

From September 2022 through November 2022, U.S. hog and pig producers weaned an average of 11.22 pigs per litter, compared to 11.19 last year, the USDA said.

“It is notable that, despite all the factors working against productivity, the 11.22 pigs is a record for the quarter, and any quarter for that matter,” said Lee Schulz, Iowa State University associate professor of agricultural economics. “Seasonally, the September-November quarter typically has the highest litter rates. An obvious question is: Where do litter rates go from here?”

The USDA said the U.S. swine breeding inventory was at 6.15 million head, up slightly from a year ago, and up slightly from Sept. 1, 2022, the first time in two and a half years, and 0.8 percent larger than analysts’ pre-report expectations.

Schulz said, “Anything plus or minus more than 1 percentage point from the average of pre-report expectations is commonly considered a surprise.

“The December 2022 through February 2023 farrowing intentions of 2.947 million litters are up 1 percent from December-February actual sows farrowing a year ago; 1.2 percentage points larger than expected, and 45,000 litters larger than the December through February expectations in the September report.”

The report said U.S. hog producers intend to have 2.95 million sows farrow between December 2022 and February 2023, and 2.98 million sows farrow between March and May 2023.

Plain said, “It looks like 2023 hog slaughter will be even to slightly below 2022’s level.

“As to whether pork production will be up or down in 2023, a lot depends on what happens to slaughter weights,” he said. “Hog weights typically increase from year to year. The USDA has been predicting 2023 pork production will be less than in 2021, but more than in 2022.”

He added, “High feed costs are likely to be a drag on slaughter weights. Cost of production was higher each month than in 2021. The USDA is estimating corn will average $6.70 per bushel for the September 2022 through August 2023 marketing year. The USDA says the average price received by corn growers in the 2021-22 marketing year was $6 per bushel.”

Altin Kalo, chief economist at Steiner Consulting in Merrimack, N.H., said, “It appears that producers were less worried about feed and demand than a year ago, allowing them to retain more gilts. It’s not enough to start rebuilding the herd in force, but a more normal retention rate than last year when the spike in feed costs, and pullback from China got everyone worried and cutting back.”

Looking into 2023, he said, “The report would suggest that producers take advantage of the prices currently offered by futures – especially for the summer and fall, and lock in profits where possible.

“Export demand is not a given, and the recession remains a risk,” he said. “If producers are retaining more gilts, and supply expands, it could result in more downside price risk. The increase in the breeding herd suggests that producers are responding to market signals.”

But, he added, “Productivity growth has been difficult to ascertain, and it remains a wild card going forward.”

According to the USDA, Iowa hog producers had the nation’s largest inventory among the states, at 23.6 million head. Minnesota had the second largest inventory, at 8.6 million head; and North Carolina was third, with 8.2 million head.

In Indiana, total hog and pig inventory was estimated at 4.35 million head, with no change from a year ago, said State Statistician Nathanial Warenski. Breeding hog inventory, at 260,000 head, was up 4 percent from last December.

In Illinois, total hog and pig inventory was 5.3 million head, up 2 percent from Sept. 1, 2022, but down 2 percent from last year. 

In Michigan, total hog and pig inventory was estimated at 1.24 million head, up 80,000 head from a year ago, said Marlo D. Johnson, USDA Great Lakes Regional Field Office director. 

In Ohio, total hog and pig inventory was estimated at 2.65 million head, down 150,000 head from a year ago, said State Statistician Cheryl Turner. Breeding hog inventory, at 190,000 head, had no change from last December.