What is in this article?:
- Higher corn prices would require more rapid export pace, South American crop concerns
- Hog slaughter numbers
- Taken together, the pace of current and expected corn consumption appears to be rapid enough to provide support for old crop prices for several more weeks, but does not suggest the need for much higher prices.
The USDA’s Grain Stocks report released on Jan. 11 confirmed that feed and residual use of corn from June through November 2012 had been large, implying that consumption had not been sufficiently rationed following the small crop of 2012.
According to University of Illinois Agricultural Economist Darrel Good, March 2013 corn futures are currently trading about 25 cents above the closing price on Jan. 10 and about 10 cents below the high reached on Jan. 16. The spot market basis also remains very strong in most markets.
“Ongoing changes in livestock production are mixed, but may be contributing to a slightly slower pace of feed consumption,” Good said. “The number of cattle in feedlots continues to be well below the level of a year ago as a result of the multi-year liquidation of the cow herd.
“The number of cattle on feed on Jan. 1, 2013, was 5.6 percent below the inventory of a year earlier, about the same magnitude of decline reported on Dec. 1, 2012.
“Placements into feedlots during December were only 0.7 percent less than during December 2011. The number of cattle slaughtered in December was 7.6 percent less than the slaughter in December 2011, but the average slaughter weight was up 26 pounds (2 percent) in December 2012.
“The number of milk cows on farms in December 2012 was only 10,000 fewer (0.1 percent) than in December 2011. The year-over-year decline was the smallest since September 2012,” he said.
Good reported that the number of broiler-type eggs set continues to exceed that of a year earlier by 1 to 2 percent each week. The number of broiler-type chicks placed each week is also currently running about 1 percent above the pace of a year earlier.
The number of chickens slaughtered in December 2012 was 2.4 percent less than the slaughter of a year earlier, but the average live weight of the slaughter was 2.1 percent above the average in December 2011.