Market News

Hog futures mostly lower, with pressure from pork, cash

 

Chicago Mercantile Exchange live cattle futures were lower on long liquidation at some disappointment over the week’s direct cash business. Packers couldn’t employ the expected leverage and the generally steady prices are probably an indication live supplies are a little tighter than expected. April was down $1.20 at $121.77 and June was $1.55 lower at $113.27.

Feeder cattle were lower on the same factors as the live pit, with additional pressure from the higher move in corn. March was $2.02 lower at $141.75 and April was down $2.37 at $143.00.

Direct cash cattle business was light to moderate. Most live sales in all the major feeding areas were at $126 to $127, generally steady with last week. Dressed business in the North was reported at $204, slightly lower than last week’s weighted average for Nebraska. Given the volume of business this week, activity could be wrapped up in some areas, while others likely have clean-up trading left to do. Asking prices for what’s left are around $128 live and $205+ dressed.

Boxed beef closed higher on light to moderate demand and offerings. Choice was up $.31 at $223.88 and Select was $1.58 higher at $216.78. The estimated cattle slaughter of 119,000 head was steady on the week and up 8,000 on the year.

At the Mitchell Livestock Auction feeder cattle sale in South Dakota, compared to last week, steers and heifers were steady, albeit with much lighter offerings because of a winter storm earlier in the week. The USDA says demand was good for an attractive offering carrying mostly moderate flesh. Medium and Large 1 feeder steers weighing 700 to 800 pounds sold at $142 to $154.25 and Large 1 feeder steers weighing 1,000 to 1,100 pounds were reported at $127.35 to $131.35. Medium and Large 1 feeder heifers weighing 700 to 800 pounds brought $132 to $141 and 800 to 900 pound heifers ranged from $126.75 to $133.25.

Lean hog futures were mostly lower on spread trade, position squaring relative to the cash index, and cash and wholesale pressure. Losses were limited by overbought signals. April was up $.27 at $68.07 and June was down $.35 at $78.25.

Cash hogs were steady to modestly lower, with good negotiated runs at most of the major direct markets. Processing margins are still in the black but getting tighter with wholesale prices dropping faster than cash. Hog weights are up on the month and the year and market ready numbers are ample, putting a lot of pork on the market, with uncertainties about export demand. Weekly sales were 19,900 tons, but a lot of the buyers would be affected by either NAFTA changes or the new steel and aluminum tariffs, which will be enacted later this month.

Pork closed $1.72 lower at $72.99. Butts were steady and picnics were firm, while the other primals were lower, including a $5.88 loss for bellies. The estimated hog slaughter of 463,000 head was down 2,000 on the week, but up 19,000 on the year.

Iowa/Southern Minnesota direct barrows and gilts closed $.33 lower at $54 to $63.50 for a weighted average of $62.57, the Western Cornbelt was down $.31 at $54 to $63.50 with an average of $62.54, and the Eastern Cornbelt was $.41 lower at $58 to $62.58 for an average of $62.27. National direct business was down $.37 at $54 to $63.50 with an average of $62.41. Butcher hogs at Zumbrota, Minnesota were steady at $40. Dorchester, Wisconsin and Garnavillo, Iowa were closed. Missouri direct butchers were steady at $52 to $56 on light to moderate supply and demand. Sows were steady to $3 lower at $34 to $46. Illinois direct sows were weak at $35 to $50 on moderate demand for moderate offerings. Barrows and gilts were weak at $39 to $44 on light to moderate demand for moderate offerings. Boars ranged from $10 to $20.