Pork Profit Maximizer – Food Service Edition
February 18, 2019
Weekly hog slaughter in the first seven weeks of the year was 4.5% higher than a year ago and about 2 points higher than what was expected based on the inventory survey. We think hog weights during this period were about 1% higher than a year ago despite USDA estimates that still have weights under a year ago. USDA-AMS has started to revise those weight estimates with actual data from NASS and in the first two weeks of this year, hog weights were 0.9% higher than a year ago.
The combination of higher slaughter and higher weights implies pork production running about 5.5% above year-ago levels. If we continue on this trend, this would imply quarterly pork production (with one less marketing day) that is up about 3.4% compared to a year ago. But leaving aside the marketing day differences, the reality is that pork packers have had to deal with a +5% jump in supply availability over the already record numbers we saw a year ago.