US lean hog futures decline seasonally

Hog producer margins were signalling contraction a year ago, but as producers are cycling out of higher priced rations, concern is easing this year, according to a recent market report from CoBank. Iowa State University estimates farrow-to-finish operators experienced their fifth consecutive month of positive margins in August at $13.63/head. And naturally, sow slaughter has declined in recent months. For August alone, sow slaughter was down 15% YoY. Still, the breeding herd was down 3% YoY on Sept. 1, at 6.044 million head which is an eight-year-low. Pigs saved per litter has continued to rise in recent quarters reaching an all-time high of 11.72 during June-August, offsetting a declining breeding herd. After peaking in July, lean hog futures are declining seasonally. Margins are expected to narrow through the end of the year. Non-feed costs remain elevated and interest in expansion is nil, so pork prices should hold their own through 2024 – yet slaughter numbers move higher in ...