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Pork cold storage numbers ‘pretty surprising’

“Pretty surprising” is how hog market analyst Steve Meyer of EMI Analytics describes Tuesday’s cold storage numbers for pork.

The USDA report showed pork supplies at the end of December were down 13 percent from a year earlier. Pork bellies dropped 67 percent, to a new monthly low.

“Relative to the November numbers, they don’t surprise me very much. But relative to where I really thought we would be, given the level of total production in the country in November and December, it is pretty surprising,” Meyer says. “That means that total usage, whether domestic or export, was remarkably strong.

“It really puts some more fuel on the fire that we’ve seen in bellies, which is really helping the cutout right now—one of the reasons we have such strong hog prices.”

Meyer says he will be raising his price forecast for the first quarter.

“We had 54 to 58 as our average for the quarter and here we are over 60 on the national net price–and so that’s probably going to leave us several dollars short on this forecast,” he says. “This report will probably feed more into that and I think you’ll see strength in the futures based on this.”

Meyer spoke with Brownfield at the annual meeting of the Iowa Pork Producers Association.

AUDIO: Steve Meyer