December Hogs & Pigs Report – 12/26/2022

USDA reported the US hog herd inventory on December 1 was down 2% year over year and the smallest since 2016. The market hog inventory was also down 2% from a year ago. We have charted our forecast for first half 2023 FIS barrow & Gilt slaughter based on the report and included it in the post.  

Farrowing intentions for the December/May 2023 period were fractionally larger than a year ago. However unfavorable weather could trim pigs saved per litter and set the December/May pig crop crop back to or less than in the same period in 2022. 

We have scattered inflation adjusted deliverable grade hog prices (January March) as a function of  the domestic per capita  pork supply (also January/March). The point for 2023 assumes USDA’s December pork supply forecast. Note that the current February hog quote (close of 12/23/2022) is directly on the regression line. Since the price-supply points for 2021 and 2022 read high on the line we assume that is likely again this winter, but to a lesser extent  as corn values (the major swine production input cost)  have declined since early 2022 but remains higher than in most past years. 

2023 projected point marked in red.