The hog inventories came in near expectations, but a little larger than expected. The breeding herd inventory was 1.7% above year ago levels as of September 1 and the market hog inventory was 1.3% higher. This is similar to recent reports that have shown modest herd expansion. Farrowing intentions for this quarter are up 1% year over year, but up 2% in the Dec-Feb quarter. The data in the report is not expected to have a big impact on the market - but what impact it has will probably be negative for deferred hog futures.

Hog inventories by weight categories show an increase of about 1% in all groups except the over 180 pounds category, which was up up 3%. That makes sense considering the higher than expected slaughter levels during September. If the data is accurate, the size of the year to year change in hog slaughter should moderate soon. Most of the hogs in the 180 pound plus category should be gone by now.

Pigs per litter came in at 9.14, the highest level in recent years. This is a 1% increase from a year earlier and triggered a 1% increase in the pig crop despite almost no change in the number of sows farrowing. The gains in productivity over the last few years have been amazing and we now have record pork production with only 6 million breeding hogs, compared to about 7 million breeding animals less than a decade ago.