General market observations

U.S. Pork in cold storage at the end of May was 525,000 lbs. down 4% from a year ago. The first time we have had lower pork storage year over year for several months. U.S. weekly pork production is around 500,000. Storage 1 week’s production. Sow slaughter for the latest week was 66,861 head. We believe a clear sign of ongoing liquidation. We estimate anything over 60,000 a week, clear sign of liquidation. Last June 1 the U.S. breeding inventory was 6.168 million. We expect this June 1 to be about 100,000 head lower. Iowa – S. Minnesota hog weights continue to slide. A week ago, 278.5 lbs., week before 279.9 lbs. (-1.4 lbs.). A year ago, 283.6 lbs. (-5.1 lbs. year over year). Lower weights indicate producers willing to sell. Packers ready to buy. On April 24th Iowa – S. Minnesota price was 67.44¢ lb. June 21st it was 96.97¢ lb. A gain of almost $60 per head. We expect the lower weights we are seeing are a positive sign that the hog price can continue higher as packers chase hogs. The c