Concentration in the pork industry is especially acute, with but a few major packers controlling the majority of the industry. For corporate and independent producers alike, it's been a great year to be a hog producer, as USDA numbers out this week can attest.
Despite one of the most profitable years for hog producers in memory, the nation's pig farmers have refrained from the type of rapid herd expansion that normally accompanies favorable prices.
USDA's December inventory released this week shows all hogs at 100 percent of year ago levels ... the number kept for breeding at 99 percent ... and the number marketed at 100 percent. Those numbers all fell below trade expectations.
Analysts called the 1 percent decrease in the number of hogs kept for breeding especially bullish. When combined with a downward revision in fall pig production, the report would seem to bode well for spring and early summer lean hog and belly prices.