Feeder pig prices suggest hog market optimism

Jun 05, 2023

Rising feeder pig prices could be signaling optimism in the market. Prices reached nearly $64 per head last week and should continue to move seasonally higher, according to an analysis from the Livestock Marketing Information Center (LMIC).

“Seasonally, weaned feeder pig prices typically peak during January or February, and last year the peak was $83.29 per head in mid-February,” LMIC says. “Based on the Iowa State University estimated returns for a wean to finish operation, a weaned feeder pig purchased in February will be marketed six months later in August.

“Last year, the peak weaned feeder pig price in February coincided with the peak base slaughter hog carcass price of $116.42 per cwt six months later in mid-August.”

Estimated returns from ISU for a wean to finish operation suggest a peak weaned feeder pig price of $74.27 per head in February, with an August selling price of $115.66 per cwt. This compares to a year ago when weaned feeder pigs purchased last February and sold in August last year, total costs were $237.46 per head and nearly half of that was total feed costs of $117.05 per head with a total profit of $4.47 per head.

“The most recent data available for weaned feeder pigs purchased in June of 2022 and marketed in December of 2022 shows that profitability was a loss of $23.31 per head, which is largely due to total feed costs of $114.25 per head, indicating less than a $3 per head decline over the last five to six months,” LMIC says.

Feed costs will play a major role in profitability estimates.

“As producers purchase weaned feeder pigs over the next few weeks to be marketed during the summer months, feed costs will be the big factor that will likely limit profitability,” LMIC says. “Producers will also be watching slaughter hog prices which seasonally reach the highest levels during the June to August time frame.”

“LMIC is forecasting the national base slaughter hog carcass price for the second quarter of 2023 to range from $99 to $103, with a third quarter range of $103 to $108 per cwt., less than 1% below 2022 levels for each quarter, suggesting there may be some room for profitability if feed costs can be kept low.”

Daily Ag News and Market information from across the midwest.

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