US pork production seen down 10 pct on Monday

CHICAGO, July 10 (Reuters) - About 10 percent of U.S. pork production will be shut down on Monday as two meat companies close pork plants for the day apparently because of poor margins and tight supplies of hogs, livestock sources said on Friday.

Two Smithfield Foods Inc (SFD.N) plants, one each in Sioux City, Iowa, and in Sioux Falls, South Dakota, will be shut on Monday, as will Tyson Foods Inc's (TSN.N) plant in Columbus Junction, Iowa, Midwest livestock dealers told Reuters.

Tyson confirmed that its Columbus Junction plant will be closed on Monday and that some of its other pork plants will run at reduced levels next week. Smithfield Foods said it does not comment on daily plant operations.

The three plants have a combined daily hog slaughter capacity of about 43,000 head, or about 10 percent of the U.S. total slaughter capacity, according to industry estimates.

Pork plants have been hurt by tight supplies of hogs and by slow pork sales, analysts and livestock dealers said

Hog supplies are normally tight in the summer and this year producers have been shrinking herds in reaction to more than a year of losses.

"We have had dismal cutout values. It is largely related to the worldwide recession," said Ron Plain, agricultural economist at the University of Missouri. "Pork exports are doing very poorly and the U.S. economy is doing poorly. There is just not a lot of demand for high quality foods."

Cutout value is an industry term referring to wholesale pork prices.

Because of the weak economy, sales of higher-priced and more profitable meats, such as beef steaks and pork loins, have been slow, said Plain.

"We've had two days in the last two or three weeks in which the cutout values have been the lowest in six years," said Plain. "Normally, we have the highest cutout values of the year during the summertime. We are getting very low cutout values at the time of year when we normally have strong cutout values." (Reporting by Bob Burgdorfer; Editing by Marguerita Choy)