Market News

Cattle, hog futures higher on short covering

At the Chicago Mercantile Exchange live cattle futures closed higher on short covering.  The rumor that China and the US could sit down for potential trade talks could have enticed buyers back into the market.  August live cattle closed $1.17 higher at $105.25 and October contracts closed $1.35 higher at $107.60.  August feeder cattle closed $1.62 higher at $151.02 and September feeder cattle closed $1.55 higher at $150.97.

Direct cash cattle trade has picked up from yesterday’s light trade – but there are still just a few scattered bids on the table.  Asking prices today are $114 to $116 live and $183 dressed, with bids at $108 live and $173 to $175 dressed.  Significant trade volume will likely be delayed until sometime on Friday.

At the Springfield Livestock Marketing Center in Missouri, receipts were down from the most recent auction and on the year.  Compared to two weeks ago steer and heifer calves were steady to $5 higher following the sharply lower trade at the previous sale.  Yearlings were not well tested.  The USDA says demand was moderate and supply was heavy.  Feeder supply included 38 percent steers and 46 percent of the offering was over 600 pounds.  Medium and Large 1 feeder steers 500 to 600 pounds brought $147.50 to $168 and feeder steers 700 to 800 pounds brought $138 to $144.75.  Medium and Large 1 feeder heifers 500 to 600 pounds brought $138 to $151 and feeder heifers 700 to 800 pounds brought $130 to $136.

Boxed beef cutout values closed mixed.  Lower on Choice and steady on Select on light to moderate demand and offerings.  Choice down $.86 at $206.58 and Select is $.13 higher at $197.01.  The Choice/Select spread ended at $9.57.  Estimated cattle slaughter is 120,000 head – even on the week and up 2,000 on the year.

Lean hog futures closed sharply higher on short covering as the market is oversold and saw a corrective bounce.  While there are rumors that trade negotiations could be developing – the market is still nervous, especially with the ample hog supply.  Contracts also saw some support from the modest gains in pork values at midday.  July lean hogs closed $.17 higher at $79.95 and August contracts closed $1.62 higher at $70.42.

Cash hogs closed lower to sharply lower.  Buyers have continued with lower bids in hopes of limiting processing margin losses.  The market continues to monitor the trade situation between the US and China and the US and Mexico.  Both are some of the top importers of US pork.  Any disruption to demand would be costly to US pork producers.   Barrows and gilts at the Iowa/Southern Minnesota closed $2.44 lower with a range of $68 to $75.25 for a weighted average of $73.68; the Western Corn Belt closed $2.82 lower with a range of $68 to $75.25 for a weighted average of $73.31; the Eastern Corn Belt had no comparison, but traded in a range of $72 to $76 for a weighted average of $75.48; and the National Daily Direct closed $.88 lower with a range of $68 to $76 for a weighted average of $75.21.

Butcher hogs at the Midwest cash markets are steady to $2 lower at $51 to $58.  At Illinois, slaughter sow receipts are down on the week and up on the year.  Sow prices are $1 lower at $27 to $39 with light demand for moderate offerings and barrows and gilts are steady at $45 to $54 with moderate demand and offerings.

Pork cutout values closed steady – down $.09 at $83.51.  The primals are mixed, led lower by the more than $3 drop in the ribs.  The picnics, hams, and bellies also closed lower, while the loins and the butts ended the day higher.  Estimated hog slaughter is 459,000 head – down 2,000 on the week and up 18,000 on the year.