Disease hits U.S. swine herd
Offsetting some of the near-term tightness in supply, market watchers see the nation's swine producers expanding their breeding herds, as feed costs have cooled considerably in the latest quarter.
The U.S. Department of Agriculture is scheduled to release its quarterly hogs and pigs inventory report Friday at 3 p.m. EDT (1900 GMT).
The average of seven analysts' estimates for all hogs and pigs as of Sept. 1 was 67.217 million head, down 1.4% from a year ago. Estimates for all hogs and pigs in the survey ranged from 3.6% below to 0.3% above the year-ago figure. The decline in the total number of hogs available this past quarter is likely due to death loss from porcine epidemic diarrhea virus, or PEDV, which began to spread in the early spring.
At the same time, with corn prices down to nearly half of what they were in September of last year, the trade sees many producers taking the opportunity to hold back as many of their sows, or adult female hogs, as possible, to expand thinned herds.
The estimates for animals kept for breeding, rather than sent to slaughter, averaged 1.5% above a year ago in a range from 0.6% to 2.0% above the same time last year. The average represents a breeding herd of about 5.875 million animals.
"The PED virus will run its course," said Tom Couch, manager of TKC Investments, a commodity-trading advisory firm in New Smyrna Beach, Fla. "And in the last two quarters of 2014, we're going to have more than an ample hog supply."