President Obama announced a $100 million purchase of pork products, to be used in school lunch and food bank programs, in a speech in Council Bluffs today and the hog markets have reacted to the news, giving hog futures a much-needed lift by $1.70 per hundredweight for the October contract and $1.37 per hundredweight for the December contract.
Hog prices have dipped by about 15 percent since the end of 2011 as record production of hogs has threatened to oversupply the market. Iowa, the nation’s largest hog producing state, has reported inventories of hogs at a record 20 million since late 2011, in large measure because of improved productivity of sows who now average ten pigs or more per litter.
The National Pork Producers Council said in response it is “grateful” for USDA’s $100 million supplemental pork purchase.
“This purchase will help pork producers who are struggling with the effects of this severe drought, which has adversely affected much of the nation’s corn crop,” Pork Producers president R.C. Hunt of Wilson, N.C., said in a statement.
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