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CME: June Commercial Hog Slaughter Lower Than a Year Ago

30 July 2013

US - The US Department of Agriculture released on Thursday, 25 July, its estimates of June red meat and poultry slaughter and production, write Steve Meyer and Len Steiner.

While the supply numbers show a decline compared to a year ago, this was largely due to calendar differences. June 2013 had 20 slaughter days vs. 21 slaughter days a year ago. Once we normalize the numbers adjust for the calendar differences, implied daily output in June 2013 was actually slightly above year ago levels. Combined beef, pork and poultry production in June was estimated at 7.360 billion pounds, 3.9 per cent higher than in June 2012. Weekday production in June 2013 (i.e. monthly production divided by number of production days) was 368.0 million pounds, 0.9 per cent higher than the implied daily production a year ago. Below are some of the highlights for each species.

Beef: Commercial cattle slaughter in June was 2.731 million head, 4.6 per cent higher than the previous year. However, the average daily slaughter in June was 136,555 head, slightly higher (+0.1 per cent) than a year ago. This was the largest average daily slaughter since September 2011. As has been the case for much of the spring, more cows coming to market continued to inflate the overall slaughter tally. Average daily steer slaughter was 71,750 head, 0.2 per cent higher than a year ago while the average daily heifer slaughter at 36,300 head/day was 1.5 per cent smaller than a year ago. While the overall decline in the number of heifers coming to market is notable, one needs to place that in the context of the overall decline in the beef and dairy cow herd. In the last three months (Apr, May, June) total heifer slaughter is estimated at 2.268 million head, 2.5 per cent lower than the same period a year ago. However, the decline represents only a 57,000 head reduction. During the same period, US beef/dairy cow slaughter was 1.588 million head, 104,000 head (+7 per cent) higher than a year ago. Total commercial beef production in June was 2.166 billion pounds, 3.8 per cent lower than a year ago. Average daily beef supplies in June were about 108.3 million lb./day, 1 per cent higher than the previous year.

Pork: Commercial hog slaughter in June was estimated at 8.200 million head, 4.1 per cent lower than a year ago. The average daily hog slaughter at 410,005 head was 0.7 per cent higher than a year ago. Average hog carcass weights in June were 205 pounds, about the same as a year ago. Steady carcass weight gains and a modest increase in the number of hogs coming to market each day implied modest increase in average daily pork production. We estimate that the average daily pork production was about 83.9 million lb/ day, 0.6 per cent more than a year ago. Despite talk of expansion, producers sent 732,000 sows to slaughter in Apr, May and June, 0.8 per cent more than the same period a year ago. This may be due in part to more gilt retention, with gilt slaughter down 2.5 per cent so far this year.

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