Farmscape for April 6, 2023

A Senior Risk Management Analyst with HAMS Marketing Services suggests China will be a key market to watch moving into the second quarter of 2023.
The U.S. Department of Agriculture released its Hogs and Pigs Report for the first quarter of 2023 March 30th.
Paul Marchand, a Senior Risk Management Analyst with HAMS Marketing Services, notes a two percent reduction in slaughter hog numbers predicted in the December report has turned into a slight increase in numbers.

Clip-Paul Marchand-HAMS Marketing Services:
The USDA usually has it pretty good and I was a little surprised that there wasn't more backlash, why where the USDA numbers off by so much?
When you did the math there was almost a four percent variance between what the USDA had implied would be available at the December Hogs and Pigs Report relative to what was actually being marketed at the beginning of the year.
The USDA has generally a good track record of implying what's going to be available for slaughter on the live hog market with the Hogs and Pigs Report.
Now that we have that supply side into the  equation, it's really going to about demand at this point and there are some things to keep an eye out for.
The ASF situation in China is apparently a little worse than what people were expecting but right now we have yet to see any activity from Chinese buyers in terms of forward-looking commitments, new net sales commitments that would give us any indication that they are either short of pork or in dire need of shoring up their supplies.
That would be one market to keep an eye on.
They are always a bit of a wild card, have been a little on the inconsistent side in terms of forward sales but their week over week actual physical deliveries is up about between 500 and a thousand metric tons per week over year ago so that is positive but again China is just nowhere near where anybody would like them to be for us to see a little support in either the nearby futures, deferred or even the cash market.

Marchand says we have a higher slaughter than year ago, there's a lot of pork in cold storage, there's not a lot of demand at the wholesale level and packers don't have to aggressively bid to secure supplies for their slaughter schedules so, right now, demand would probably be the biggest item to watch.
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Bruce Cochrane.

       *Farmscape is produced on behalf of North America’s pork producers