Record high hog numbers, up 5% from year ago

The U.S. inventory of all hogs and pigs on June 1, 2020 was 79.6 million head. This was up 5% from June 1, 2019, and up 3% from March 1, 2020.

That is a record-large inventory number, says economist Steve Meyer, Kerns & Associates, and it surprised industry analysts. The average pre-report estimate for growth was +3.7%, he says.

(Should the industry have been surprised? See the exclusive Successful Farming 2019 Pork Powerhouses sow numbers here.)

Market hog inventory, at 73.3 million head, was up 6% from last year, and up 3% from last quarter.

Bearish report

"When I look over these numbers, it is hard to find too many things on the positive side out of this report," says Scott Brown, associate Extension professor, University of Missouri-Columbia. "A lot of the news out of this report is bearish."

Breeding inventory, at 6.33 million head, was down 1% from last year, and down 1% from the previous quarter.

The March-May 2020 pig crop, at 34.9 million head, was up 1% from 2019. Sows farrowing during this period totaled 3.17 million head, up 1% from 2019. The sows farrowed during this quarter represented 50% of the breeding herd.

"It reminds me that we have a lot of hogs to come to market the remainder of 2020, and it is going to create a lot of challenges for us," says Brown. "There's not a lot of help on the supply side from a price standpoint."

Bigger pig crop

The average pigs saved per litter was a record high of 11.01 for the March-May period, compared to 11.00 last year.

The March-May sows farrowing number came in higher than pre-report expectations, says Lee Schulz, associate professor, Iowa State University. More sows farrowing and a slight increase in pigs saved per litter mean a bigger pig crop.

"With the backlog we are working through, that will further pressure the market as we see larger supplies," says Schulz.

U.S. hog producers intend to have 3.12 million sows farrow during the June-August 2020 quarter, down 5% from the actual farrowings during the same period one year earlier, and down 2% from the same period two years earlier.

Intended farrowings for September-November 2020, at 3.09 million sows, are down 5% from the same period one year earlier, and down 4% from the same period two years earlier.

The total number of hogs under contract owned by operations with over 5,000 head, but raised by contractees, accounted for 49% of the total U.S. hog inventory, up 2% from the previous year.