United States-Too many pigs.

UNITED STATES-PIG NUMBERS NEED TO BE TRIMMED.

Hog producers must continue to cut the herd size somewhat to elevate hog prices to parity with costs of production in 2010 despite improving price prospects, according to a Purdue University Extension marketing specialist.

"Hog prices are expected to exceed costs in the second and third quarter this year before returning to modest losses in the fourth quarter and in the first quarter of 2010," said Chris Hurt. "Some further reduction in the size of the U.S. and Canadian breeding herds is expected into 2010, and this, along with recovery in the world economy, may provide a slightly more positive tone for hog prices in 2010.

"Unfortunately, an improving world economy would also increase grain and soybean utilization and likely strengthen feed prices as well."

Hurt’s comments came as he reviewed the state of the pork industry which has seen some recent good news, but some bad news as well.

"When it all shakes out, both 2009 and 2010 may be about breakeven years," he said. "But breakeven covers all costs, including full capital replacement and family labor costs.

"After a year and a half of losses, average cost hog producers should finally make money this spring and summer."

The best of the news is that hog prices should soon begin a strong increase related to the normal seasonal pattern, he noted. Hog prices have tended to move higher from mid-April into the spring.