U.S. hog producers should break even in 2010 as both the average price received and the total cost of production are expected around $50 per hundredweight, according to Purdue University Extension Economist Chris Hurt.

In a report, Hurt forecast first quarter live hog prices “in the higher $40s per hundredweight” followed by “the low $50s” in the second quarter, “nearly $50″ in the third quarter and “in the mid-to-higher $40s” in the fourth quarter.

He put total costs of production, including feed, labor and full depreciation of buildings and equipment at $50 to $51 per hundredweight.

“The bottom line is that hog producers are not expected to go backwards financially in 2010,” said Hurt.

Back to the Midwest

Hurt also noted that hog production, which tended to grow in areas away from the corn belt over the past two decades, now appears to be consolidating back to the Midwest.

While the U.S. breeding herd has dropped by 6 percent over the past two years, greater reductions have occurred in North Carolina, Texas, Utah, Arkansas and California. For example, North Carolina’s breeding herd declined by 90,000 head, or 9 percent, over the past two years.

Even though breeding herd reductions have been offset by increased pigs per litter, Hurt said domestic consumers will notice much tighter pork supplies in 2010. He predicted smaller U.S. pork production and increased exports will meet improved domestic demand as the U.S. economy recovers and the H1N1 virus falls off the front pages as a news story.