Market Outlook - 2010

From information, knowledge
Paragon Economics, Inc.
Steve R. Meyer, Ph.D.
NPB Pork Management Conference -- 2010
Profit Prospects for Pork Producers
– 2010 and Beyond

Profit outlook for 2010 and 2011 . . .
GOOD!
FINALLY!!!!

Profits for the foreseeable future because:
 Lower – but NOT LOW – costs with even
lower input prices possible
- EXCELLENT planting season
- Acres are good, condition is good at present
- It‟s up to Mother Nature – and maybe the EU
 Hog price recovery – better than expected
- Slightly lower supplies
- Stronger wholesale and farm demand
- Help from competitors – but will it last?

Short-term risks to consider:
 Weather – the crop is not made YET
 Economic turmoil in Europe and the
impact on $US and exports
 Domestic demand if the “recovery”
remains soft
 Quick supply response to profits
 A host of potential goofy occurrences –
remember H1N1?

Grain and feed cost outlook – Issues:
 Record-early corn planting and very good
crop condition
 Weak ethanol margins, “low” oil prices –
will not be supportive of corn
 Modest increase in corn exports -- $US???
 Expectations on E-15 decision
 El Nino – La Nina???
 Last week‟s Crop Prod & WASDE – nothing
big
 BIG REPORTS: June 30 Acreage & Stocks

Corn planting and condition
CORN CROP PROGRESS
Percent Planted, 18 States
0
10
20
30
40
50
60
70
80
90
100
4/4 4/11 4/18 4/25 5/2 5/9 5/16 5/23 5/30 6/6 6/13 6/20
2005: Fastest since 1990
1993: Slowest since 1990
'05-'09 Average
2009
2010
Corn planting is
complete – but
look when the
bulk occurred!
Crop condition
is the best ever
for 1st week of
June
CORN CROP CONDITION
Percent rated Good or Excellent
30
40
50
60
70
80
90
5/23 5/30 6/6 6/13 6/20 6/27 7/4 7/11 7/18 7/25 8/1 8/8 8/15 8/22 8/29 9/5 9/12 9/19 9/26
2002: Worst annual
rating since 1990
1994: Best annual
rating since 1990
2010
2009
10-yr average

Planting progress, though . . .
CORN -- YIELDS VS. MID-MAY PLANTINGS
-20%
-15%
-10%
-5%
0%
5%
10%
15%
90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10
Year
PctYieldDeviationfromTrend
30
40
50
60
70
80
90
100
PercentPlanted
Yield Deviation
Mid-May Planting
. . . Is NOT a good yield predictor
R2 for yield deviation = 0.3, for yield = 0.17

June 2010 WASDE forecast by USDA
2008/09 2009/10 2010/11
USDA,
June
% Chng.
vs '08-.09
USDA,
June
%Chng
vs. '09-'10
Acres Planted Mil A 86.0 86.5 0.6% 88.8 2.7%
Acres Harvested Mil A 78.6 79.6 1.3% 81.8 2.8%
Yield Bu/A 153.9 164.7 7.0% 163.5 -0.7%
Beginning Stocks Mil Bu. 1624 1673 3.0% 1603 -4.2%
Production Mil Bu. 12092 13110 8.4% 13370 2.0%
Imports Mil Bu. 14 10 -28.6% 10 0.0%
Total Supply Mil Bu. 13729 14793 7.8% 14983 1.3%
Food, Seed & Ind Mil Bu. 1316 1340 1.8% 1360 1.5%
Ethanol for fuel Mil Bu. 3677 4550 23.7% 4700 3.3%
Feed & Resid Mil Bu. 5205 5350 2.8% 5350 0.0%
Exports Mil Bu. 1858 1950 5.0% 2000 2.6%
Total Usage Mil Bu. 12056 13190 9.4% 13410 1.7%
Carryover Mil Bu. 1673 1603 -4.2% 1573 -1.9%
Stocks/Use 13.9% 12.2% -12.4% 11.7% -3.5%
Nat. Wtd. Avg. Farm Price $/Bu. 4.06 3.45-3.65 -11.3% 3.30-3.90 -2.8%
U.S. CORN SUPPLY AND UTILIZATION - JUNE

Usage - graphically
U.S. CORN USAGE BY CATEGORY
0
1000
2000
3000
4000
5000
6000
7000
1969 1972 1975 1978 1981 1984 1987 1990 1993 1996 1999 2002 2005 2008
Million bu.
Ethanol
FSI-Non Ethanol
Feed & Residual
Exports
USDA Forecasts, June 2010

Ethanol margins have fallen -- again

Corn export pace has been SLOW
U.S. CORN EXPORTS
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
S O N D J F M A M J J A
1000 Bu.
2009
2008
Avg. '04-'08
U.S. CORN EXPORTS, PCT. OF ANNUAL
0%
20%
40%
60%
80%
100%
120%
Percent
2009
2008
Avg. '04-'08

2010 forecast is in line with ‟09 corn demand
U.S. CORN PRICE VS. S/U RATIO
1990-2010
1990
1991
1992
1993
1994
1995
1996
1998
1999 2000
2001
2002
2003
20042005
2006
2009
2008
2010
2007
1997
1.50
2.00
2.50
3.00
3.50
4.00
4.50
5.00
0% 5% 10% 15% 20% 25% 30%
Ending Stocks/Use Ratio
$/bu
Note: Data label is
the year of the
Latest information: 6/10/2010

Implications and risks
 Season-average price of $3.60 implies an
Iowa harvest price of $3.10 to $3.20/bu
 USDA yield of 163.5 bu./A is already 1.7
bu./A ABOVE the ‟96-‟07 “biotech” trend
 Good crop conditions, lagging export pace
may push corn lower through late summer

But new-crop futures found support . . .
Those “lows”, though,
were at $3.56 for Dec
and $3.88 for March!
. . . At contract-life lows

How much bottom side is available?
CASH CORN PRICE, OMAHA, WEEKLY
0.00
1.00
2.00
3.00
4.00
5.00
6.00
7.00
8.00
91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10
$/bu.
Source: USDA, Agricultural Marketing Service

 USDA yield of 163.5 bu/acre is 1.7 bu
above the ‟96-‟07 “biotech” trend
 Good crop conditions will push corn lower
through late summer
 Remember -- Season lows were in Sept in
„‟06, early Oct in ‟07 and July in ‟09

 USDA yield of 163.5 bu/acre is 1.7 bu
above the ‟96-‟07 “biotech” trend
through late summer
 Remember that season lows were in Sept
in „‟06, early Oct in ‟07 and July in ‟09
 Strong $US could keep oil prices – and
ethanol prices -- in check

Oil is back near $70 – less support for corn

 Season-average price of $3.50 implies an Iowa
harvest price of $3.00 to $3.10/bu
 USDA yield of 163.5 bu/acre is 1.7 bu above the
‟96-‟07 “biotech” trend
through late summer
 Remember that season lows were in Sept in
„‟06, early Oct in ‟07 and July in ‟09
 Strong $US could keep oil prices – and ethanol
prices in check
 E-15 (or E-11 or E-12) decision

Corn strategies
 Given the price outlook for hog --
- “Higher” corn prices can be handled
- Extreme corn prices, as always, cannot!
 Start filling storage EARLY in harvest
 Having physical corn in hand is normally
advisable – perhaps not a big deal for
2010-11
 Buy “insurance” out-of-the-money calls if
your balance sheet is still weak

Soybean planting and early condition
Soybean planting
has been slowed
by rain – now
EQUAL to 2009
Crop rating this
week is RECORD
HIGH at 73%
Good/Exc.
SOYBEAN CROP PROGRESS
Acres Planted, 18 States
0
10
20
30
40
50
60
70
80
90
100
5/2 5/9 5/16 5/23 5/30 6/6 6/13 6/20 6/27 7/4 7/11 7/18
Percent
2000: Fastest since 1990
1993: Slowest since 1990
'03-'08 Average
2009
2010
SOYBEAN CROP CONDITION
Percent Rated Good or Excellent
30
40
50
60
70
80
90
6/6 6/20 7/4 7/18 8/1 8/15 8/29 9/12 9/26 10/10
1994 = Best
since 1990
1993 = Worst
since 1990
2009
10-yr Average
2010

June USDA WASDE – 2X on S/U ratio for ‟11 . . .
2008/09
Est.
USDA,
May
% Chng
vs '08-'09
USDA,
May
% Chng
vs '09-'10
Acres Planted Mil A 75.7 77.5 2.4% 78.1 0.8%
Acres Harvested Mil A 74.7 76.6 2.5% 77.1 0.7%
Yield Bu/A 39.7 44.0 10.8% 42.9 -2.5%
Beginning Stocks Mil Bu. 205 138 -32.7% 185 34.1%
Production Mil Bu. 2967 3359 13.2% 3310 -1.5%
Imports Mil Bu. 15 15 0.0% 10 -33.3%
Total Supply Mil Bu. 3187 3512 10.2% 3505 -0.2%
Crushings Mil Bu. 1662 1740 4.7% 1640 -5.7%
Exports Mil Bu. 1280 1435 12.1% 1350 -5.9%
Seed Mil Bu. 95 91 -4.2% 88 -3.3%
Residual Mil Bu. 11 42 281.8% 66 57.1%
Total Usage Mil Bu. 3049 3323 9.0% 3144 -5.4%
Carryover Mil Bu. 138 185 34.1% 360 94.6%
Stocks/Use 4.5% 5.6% 23.0% 11.5% 105.7%
Nat. Wtd. Avg. Farm Price $/Bu. 9.97 9.50 -8.2% 8.00-9.50 -7.9%
Soybean Oil Price Cents/lb. 32.16 36.00 11.9% 34 - 38 0.0%
Soybean Meal Price $/ton 331.17 295.00 -10.9% 230-270 -15.3%
U.S. SOYBEAN SUPPLY & UTILIZATION - JUNE
2009/10 2010/11
. . . But this summer could still be tight

Bean exports have been robust!!
U.S. SOYBEAN EXPORTS
0
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
1000 Bu.
2008
2009
Avg. '04-'08
. . . Could leave supplies tight in July-Aug

Pace relative to annual is slower . . .
U.S. SOYBEAN EXPORTS, PCT. OF
ANNUAL
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Percent
2009
2008
Avg. '04-'08
. . . will they exceed expected 1.435 bil. bu.?

Remember where cash SBM went . . .
. . . The past two summers on tight supplies
CASH SBM PRICE, DECATUR, WEEKLY
100
150
200
250
300
350
400
450
500
91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10
$/ton

2011 futures are at the BOTTOM . . .
. . . of the apparent “new normal” range
CASH SBM PRICE, DECATUR, WEEKLY
100
150
200
250
300
350
400
450
500
91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11
$/ton
Decature 48% SBM
6/15/2010 Futures

Factors to consider
 As is the case for corn, good weather
could push prices lower in late summer
 So could a slowdown in the torrid export
pace
 2011 prices: Will Brazil and Argentina
raise another bumper crop?
 How wrong can you be with SBM hedged
at $250 or maybe even $230?

A word about DDGS prices . . .
DDGS $ PER LB / CORN $ PER LB
0.6
0.7
0.8
0.9
1
1.1
1.2
1.3
1.4
1.5
1.6
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Ratio
DDGS is competitive with corn in
hog diets in this range
. . . Larger supplies = Pricing “into” hog diets

PORK AND HOG OUTLOOK

Summary
 Hog supplies have been CLOSE to levels
expected from March H&P
 Prices have exceeded levels a) expected
and b) consistent with supply changes
and stable farm-level demand
 Conflicting signals:
- Near-record cutout values and hog prices
STRONG packer margins
- “Okay” exports – at least through March
- But SOFT consumer-level demand

Summary (continued)
 Feed cost outlook is positive for profits –
depending on weather
 Few signs of expansion yet
- Sow slaughter is low but not exceptionally so
as a percent of the BH
- Gilt slaughter frequently above 49.5%
 But – anecdotal expansion evidence
- Some repops in the works
- 473k sows cut since Dec ‟07 – Estimate that
1/4th could be repopped – 2% growth

COMPETITORS

Chicken production capacity is growing . . .
BROILER HATCHERY FLOCK
30,000
35,000
40,000
45,000
50,000
55,000
60,000
90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10
Thousand Hens
October 2009:
Smallest flock since
Sept '97 at 52.366
million
April '10: +2.4% Yr/Yr

Current output measures are positive . . .
WEEKLY BROILER EGG SETS
180,000
185,000
190,000
195,000
200,000
205,000
210,000
215,000
220,000
J F M A M J J A S O N D
Thousand
2010
2009
Average '04-'08
y
YTD 2010: +1.4%
U.S. FI BROILER SLAUGHTER, WEEKLY
100,000
110,000
120,000
130,000
140,000
150,000
160,000
170,000
180,000
Thous. Hd.
2010
2009
2008
Avg. '03-'07
2010: 3.4%
FI BROILER PRODUCTION, WEEKLY
600.00
650.00
700.00
750.00
800.00
850.00
900.00
950.00
1000.00
Mil. lbs. RTC
2010
2009
Avg. '04-'08
YTD 2010: +4.9%

But chicken prices are near-record high
BROILER PRICES
12-City Composite, Weekly
68
73
78
83
88
93
JAN
APR
JU
L
O
C
T
Cents Per Pound
Avg.
2004-08
2009
2010

Driven by a resurgence in breast prices . . .
WHOLESALE CHICKEN BREAST PRICES
Skinless/Boneless, Northeast, Truckload, Weekly
100
110
120
130
140
150
160
170
180
JAN
APR
JU
L
O
C
T
Cents Per Pound
Avg.
2004-08
2009
2010
. . . At least until last week!

Cattle slaughter: Closer and closer to „09
U.S. FI CATTLE SLAUGHTER, WEEKLY
450
500
550
600
650
700
750
Thous. hd.
2009
2010
Average, '04-'08

Sharply lower weights have limited output
FI CATTLE CARCASS WEIGHTS
740
750
760
770
780
790
800
810
Pounds
2009
2010
Avg. '04-'08 FI BEEF PRODUCTION, WEEKLY
350
400
450
500
550
600
Mil. lbs. carc.
2009
2010
Avg '04-'08
YTD 2010: -0.4%

Cutout has been near record-high . . .
. . . But has peaked for the year
600-900# CHOICE BEEF CUTOUT VALUE
75
100
125
150
175
200
99 00 01 02 03 04 05 06 07 08 09 10
$/cwt carcass

Beef F/S cuts have fallen, too
WHOLESALE BEEF FULL TENDER PRICES
Musl-On, 5 Pounds and Up, Weekly
550
650
750
850
950
1050
1150
JAN
APR
JU
L
O
C
T
$ Per Cwt.
Avg.
2004-08
2009
2010
WHOLESALE BEEF LOIN STRIP PRICES
Boneless 0x1, Weekly
350
400
450
500
550
600
650
700
JAN
APR
JU
L
O
C
T
$ Per Cwt.
Avg.
2004-08
2009
2010
WHOLESALE BEEF RIBEYE PRICES
Boneless, Light, Weekly
400
450
500
550
600
650
700
750
JAN
APR
JU
L
O
C
T
$ Per Cwt.
Avg.
2004-08
2009
2010
WHOLESALE BONELESS BEEF PRICES
Fresh, 50% Lean, Weekly
35
45
55
65
75
85
95
105
115
125
JAN
APR
JU
L
O
C
T
$ Per Cwt.
Avg.
2004-08
2009
2010

Impact of competitors
 Positive so far! – chicken and beef prices
have been very supportive so far in ‟10
 Will be less supportive in months to come
- Beef is in a seasonal price decline but sup-
plies will get tighter, higher fed prices in „11
- Chicken may be at its peak – expansions by
Pilgrim, Sanderson, others in ‟11 and ‟12
 Trade developments will help chicken –
nothing has moved to Russia yet

Actual slghtr has been -1% from March H&P
. . and -2.7% from ‟09 -- -4.5% yr/yr coming
FI HOG SLAUGHTER, WEEKLY
1500
1600
1700
1800
1900
2000
2100
2200
2300
2400
2500
Thous. Hd.
Actual 09
Pred '10
Actual 10
Pred '11
Based on USDA Hogs & Pigs Report, March '10
These 2011 forecasts may
be revised as the impact
of
winter performance is
determined over Q2.

Weights: YTD equal to 2009, +1# recently . . .
. . . larger hogs=more profit, slack space
FI CARCASS WEIGHTS, HOGS
192
194
196
198
200
202
204
206
208
Pounds
2008
2009
2010
Avg '04-'08

YTD output is still -3.6% from last year . . .
. . . Says prices should be +8 to 12%
FI PORK PRODUCTION, WEEKLY
280
320
360
400
440
480
520
Mil. lbs. carc.
2009
2008
2010
Avg '04-'08
YTD 2010: -3.6%

Record-high hog prices -- +30% from „09
U.S. NEG'D NET PRICE, WTD. AVERAGE
40
45
50
55
60
65
70
75
80
85
90
95
100
$/cwt carcass
2009
2008
2010
Avg '04-'08

Why the discrepancy in prices?
 ‟09 prices were artificially depressed
- H1N1 aftermath
- High weights driven by unusual weather
- An “unrepresentative base” from which to
compute prices
 Positive impact of other species
- Using a price flexibility considers only own-
quantity impacts
- Cross-price elasticities are smaller but not
zero!

Exports +2.2% in April, +1.5% YTD . . .
MONTHLY U.S. PORK EXPORTS
-
100,000
200,000
300,000
400,000
500,000
600,000
J-98 J-99 J-00 J-01 J-02 J-03 J-04 J-05 J-06 J-07 J-08 J-09 J-10
Thous. lbs. carc.
April 2010 exports:
+2.2%from 2009
'04-'07 Trend

Competitors: EU has gained an advantage
U.S. EXPORT COMPETITORS'
CURRENCIES VS. $U.S.
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
2.2
92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 10
Euro & $Can/$US
0.9
1.3
1.7
2.1
2.5
2.9
3.3
3.7
4.1
Real/$US
Euro
Canadian $
Real

Customers: Recent changes, Japan & Mexico
U.S. EXPORT CUSTOMERS' CURRENCIES
VS. $U.S.
0
20
40
60
80
100
120
140
160
180
92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 10
Yen/$US,
Peso/$10US
Renminbi/$10US
400
600
800
1000
1200
1400
1600
1800
2000
Won/$USPesos/$10 Yen/US$
Renminbi/$10 Won/US$

Big recovery for Japan in April . . .
U.S. PORK EXPORTS BY DESTINATION
-
20
40
60
80
100
120
140
160
J-05 J-06 J-07 J-08 J-09 J-10
Million lbs. carc.
JAPAN
CANADA
MEXICO
RUSSIA
HONG KONG +
CHINA
TAIWAN
KOREA
. . .Mexico is still strong, Russia‟s the problem

Pork demand: conflict with hogs & whlsle . .
PORK DEMAND INDEX
80
90
100
110
120
130
70 73 76 79 82 85 88 91 94 97 00 03 06
Index, '85=100
Pork Demand
declined 4.2% per
year -- 1979 -1985
2010: -5.3%
. . . I suspect the retail price data!

Pork and chicken prices don‟t make sense!
RETAIL MEAT PRICES, USDA
0
50
100
150
200
250
300
350
400
450
500
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Cents/lb.
All-Fresh Beef
Choice Beef
Pork
Composite Broiler
Turkey

Profits are back – in a BIG way!!!
PROFIT PER HEAD
IOWA FARROW-TO-FINISH OPERATIONS
-70
-60
-50
-40
-30
-20
-10
0
10
20
30
40
50
91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10
$/HD.
Source: Estimated Costs and Returns, Dr. John Lawrence, Department of Economics, Iowa State University

But financial positions are generally weak
ACCUMULATED PROFITS
IOWA FARROW-TO-FINISH OPERATIONS
(Sum of the profits from selling one pig per month since January 1991)
$(200)
$(100)
$-
$100
$200
$300
$400
$500
$600
$700
$800
$900
91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10
Peak in Sept '07 = $786.87
Top to Bottom:
Sept '07 to Feb 2010
Lost $639.68
81% of peak amount
Source: Paragon Economics, Inc. using data from Estimated Costs and Returns, Dr. John Lawrence, Department of Economics, Iowa State
University
March '10 = $156.02
8 years

Sow slaughter is lower – 3 to 4% since April
U.S. SOW SLAUGHTER
40
45
50
55
60
65
70
75
Thousand Hd.
2009
2010
Avg. '04-'08

But slaughter of US sows is equal to ‟09 . . .
. . . YTD ‟10 = 17.1% vs. 16.9% in „09
FI SLAUGHTER OF U.S. SOWS
As a Percent of Previous Quarter's Breeding Herd
0.30%
0.40%
0.50%
0.60%
0.70%
0.80%
0.90%
1.00%
1.10%
1.20%
Percent
2009
2010
Avg. '07-'09

YTD gilt slaughter: +0.1% vs. ‟09, -0.1 vs. „08
GILTS AS A PERCENT OF TOTAL
BARROW/GILT SLAUGHTER
47.0
48.0
49.0
50.0
51.0
52.0
53.0
Percent
2009
2010
Avg. '00-'09

Futures: Profits of ~$16/hd for all of ‟10 . . .
. . . and nearly $20 for rest of ‟10, $19 for „11
ACTUAL & PREDICTED HOG
PRODUCTION COSTS* AND PRICES
10
20
30
40
50
60
70
80
90
100
96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11
$/cwt carcass
Actual Costs per ISU - Carcass
Predicted/Forecast Costs - Carcass
Cash Hog Price
Futures-Implied IA-MN Price
*Based on relationsip between ISU Estimated Costs & Returns data and historic Omaha corn and Decatur soybean meal prices
6/14/10
Forecast 2010 Profits
$15.82/head

Slaughter forecasts
Mil. Hd % Chnge Mil. Hd % Chnge Mil. Hd % Chnge Mil. Hd % Chnge
2009 Year 113.583 -2.7%
2010 Q1 27.631 -3.1% 27.631 -3.1% 27.631 -3.1% 27.631 -3.1%
Q2 26.575 -1.8% 26.395 -2.5% 26.198 -3.2% 26.139 -2.6%
Q3 27.425 -3.5% 27.860 -2.0% 27.807 -2.2% 27.175 -4.4%
Q4 28.775 -2.8% 28.726 -3.0% 28.973 -2.2% 28.184 -2.3%
Year 110.406 -2.8% 110.612 -2.6% 110.609 -2.6% 109.129 -3.9%
2011 Q1 27.493 -0.5% 27.132 -1.8% 27.983 1.3%
Green figures are actual data from USDA. 3/2/10
March 2010 Commercial Slaughter Forecasts
Mizzou LMIC MeyerISU

Price forecasts
Missouri ISU LMIC Meyer CME
Producer-Sold
Net Carcass
Ia-S. Mn. Live
Price1
National Wtd
Avg. Base Price
National Net
Neg'd Price,
Wtd. Avg.
CME Lean
Hog Futures
6/4/10
2009 Q1 60.43 56.48 58.11 57.22 $58.14**
Q2 61.76 58.39 59.45 58.19 $59.03**
Q3 56.68 52.60 54.01 52.39 $54.18**
Q4 57.64 55.92 55.57 55.81 $56.60**
Year 59.11 55.84 56.87 55.90 $56.98**
2010 Q1 68.60* 70.41* 65.95* 68.75* 69.38**
Q2 71 - 75 77 - 81 74-75 81.98* 80.70**
Q3 73 - 77 72 - 75 70-74 76 - 78 77.51
Q4 66 - 70 61 - 65 67-71 68 - 70 71.04
Year 70 - 73 70 - 73 69-71 73 - 74 74.66
2011 Q1 63 - 67 70-75 66 - 70 70.13
1
Converted to carcass using a yield of 75% *Partial USDA data **Average of CME Lean Hog Index
March 2010 Hogs & Pigs Price Forecasts

My expectations
 June Hogs and Pigs may show small BH
growth from March but still down 2-3%
from ‟09; 3-4% lower market supplies.
 Hog supplies will be supportive of prices
in the upper $70s to low $80s for the rest
of the summer
 Q4 prices in the upper $60s
 Little or no expansion, 2011 numbers
very close to 2010, prices depend on
demand!

QUESTIONS & DISCUSSION?

Market Outlook - 2010

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Market Outlook - 2010