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Reserve Dank of Chicago IN rtc III December 16, 1955 HOG SLAUGHTER in recent months has been run. ning well above the indicated 9 per cent increase in the spring pig crop. Since mid-October slaughter has averaged over 15 per cent above year-earlier and prices have averaged about 30 per cent lower. One reason cited for the increase in slaughter is marketings of hogs this fall and winter than earlier the last year. Average weights of hogs marketed in November were 224 pounds compared with 231 pounds a year ago. And it is estimated that the average age of hogs sold from Iowa farms in October was 6.4 months cornpared with 6.5 months last year. These small differences,however,suggest that the faster rate of marketings probably does not account for any substantial part of the increase. Furthermore, a review of the pattern of spring farrowings does not provide a satisfactory explanation for the increase. Virtually all of the increase in the spring pig crop was reported to be due to early farrowings, and hence most observers had expected slaughter during the last four months of 1956 to be, at the outside, only 7 per cent larger than a year ago. The peak in marketings last year was reached during early December. Some traders have hazarded the guess that last week's record slaughter was the high point this year and that the "worst may be past." al Ltd Number 331 who are inclined to explain the substantial increase in slaughter by earlier marketings are now wondering if the way has been cleared for a more than normal winter price rise. Any rise is not expected to carry prices above those of last winter as the fall pig crop is estimated to be 11 per cent larger than that of a year earlier. And pigs from the fall crop will begin to be marketed in substantial numbers in the weeks ahead. The hog-corn price ratio at Chicago in recent weeks has fluctuated around 9, compared with about 12 a year earlier. Hog prices continued to decline while some seasonal strength in the corn market raised the price of No. 3 corn from around $1.15 in mid-November to over $1.25. • The narrow ratio will help to deter expansion in the 1956 spring pig crop. Nevertheless, some observers expect the spring crop to be larger, primarily because of plentiful feed supplies and generally low feed prices After the seasonal peak in marketings is past, there outside the western Corn Belt. Secretary Benson recently is usually a winter price recovery. Prices of barrows warned the country's hog producers that it would be and gilts at Chicago normally rise about 8 per t desirable to hold down the production of pigs next spring between December and February. But market,aplysts so as to prevent a further price decline. The USDA report „r on farmers' intentions for spring farrowings will be rePRICE OF BARROWS AND GILTS AT CHICA leased December 22 and will provide a clearer picture Ict dollars per cwt. f the prospects. 28 sfc • 195 SHIPMENTS OF FEEDER CATTLE into Corn Belt 24 --X states during the July-October period were 3 per cent smaller than those of a year earlier. While inshipments 20 trailed year-earlier levels during the opening months of -<" the seasonal movement, by October they were running 16 1955 slightly larger. And judging from the volume of shipments from public markets, it appears that total inship12 ments may have continued to outdistance their year1 1 earlier levels during November. HOGS SLAUGHTERED AT FEDERALLY INSPECTED MARKETS million head 7 6 ••• 1955 5 4 • \e/ •• •• 40" 1954 3 rt- I I mar lune I sept 1 Whereas last fall farmers bought lightweight cattle and calves in large numbers, this year interest has been relatively greater in the heavier weight feeders. Many of the lighter weight cattle bought a year ago were on farms for 12 months or more and have been sold at the low prices of recent months whereas many cattle purchased for short feeding were generally quite profitable. This experience probably accounts in part for the shift in kinds and weights of cattle purchased for feeding. I dec Research . Department
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