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USDA Hogs & Pigs Report                03/27 14:10
By John A. Harrington
DTN Livestock Analyst

             March 1 Hogs & Pigs Report by John A. Harrington

                          USDA Actual   Average Guess   Guess Range

All Hogs March 1          107.0%            107.0%     105.0-108.5%
Kept for Breeding         102.0%            103.5%     102.5-104.5%
Kept for Marketing        108.0%            107.0%     105.0-109.0%
180# Plus                 109.0%            107.0%     104.5-108.0%
120-179#                  106.0%            106.0%     103.0-108.5%
50-119#                   107.0%            107.0%     104.0-109.0%
Under 50#                 109.0%            109.0%     104.0-106.0%
Dec-Feb                   102.0%            104.0%     103.0-104.0%
Mar-May*                  102.0%            103.0%     102.0-104.0%
Jun-Aug*                   98.0%            102.5%     108.0-112.0%
Winter Pig Crop           109.0%            109.5%     104.5-111.0%
Dec-Feb Pigs per Litter   107.0%            105.5%     101.5-104.0%

The quarterly hog inventory just released contains surprises on both sides 
of the aisle. For starters, the breeding herd as of March 1 appears to 
reflect smaller growth than expected. On the other hand, the market herd 
inventory appears to be well anticipated, generally fitting with pre-
report guesses. 
As far as farrowings are concerned, the winter farrow turned out to be 
smaller than analysts were assuming. Yet, the total Dec-Feb pig crop 
turned out to be fairly steady with trade expectations. Note that event 
though the winter farrow was somewhat smaller than expected, pigs per 
litter totaled more than the trade was looking for. 
All inventory and pig crop estimates for March 2014 through December 2014 
were reviewed using final pig crop, official slaughter, death loss, and 
updated import and export data. An upward revision of 0.1% was made to the 
December 2014 all hogs and pigs inventory. The net revision to the 
September 2014 all hogs and pigs inventory was 0.9%. A net revision of 
2.9% was made to the June-August 2014 pig crop.
Despite all these revisions, the USDA strangely decided to let the 
estimate of the fall pig crop stand unchanged, at least for the moment. 
The fall pig crop continues to total 29.37 million head, barely 4% above 
the previous year. This seems odd given the enormous weekly kills seen 
since March 1. Indeed, this week's kill totaled 2.27 million head, 11.8% 
above last year. In short, the fall pig crop continues to look too small 
in comparison with actual slaughter.
Based upon the smaller-than-expected breeding herd and somewhat smaller 
winter pig crop, our guess is that deferred lean hog futures will open at 
least 50 to 100 points higher when trade resumes on Monday. 

For more from John, visit http://www.feelofthemarket.com/
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