Market News

Lean hogs higher on speculative trade talks

At the Chicago Mercantile Exchange, live cattle futures closed slightly higher on spillover support from the hog markets.  Feeder cattle were higher on support from the latest export sales data.  August live cattle were unchanged at $108.32 and October live cattle were $.27 higher at $109.27.  August feeder cattle closed $1.22 higher at $150.27 and September feeder cattle closed $.97 higher at $150.12.

Direct cash cattle trade has been at a virtual standstill and we’re headed to another Friday showdown.  There are some bids at $108 live in Nebraska and Texas and $172 to $173 dressed in Nebraska.  While there are bids on the table, asking prices are still $4 or more higher at $112 to $114 live and $178-plus, dressed.

At the Mitchell Livestock Auction in South Dakota, receipts were up on the week and down slightly on the year.  There were too few feeder steers and heifers to make an accurate comparison.  There was very good demand for the nice offering of long strings of yearling steers and heifers.  There were several consignments of lighter fleshed yearlings that came straight off grass, some out of feedyards in an attractive flesh as well.  The market was very active throughout the sale as buyers are eager to buy yearlings, in spite of losses still being realized on outgoing fed cattle.  Feeder supply included 35 percent steers and 97 percent of the offering was over 600 pounds.  Medium and Large 1 feeder steers 803 to 826 pounds were $147.25 to $153.75 and feeder steers 868 to 896 pounds brought $143 to $154.50.  Medium and Large 1 feeder heifers 756 to 799 pounds brought $137.50 to $146.25 and feeder heifers 803 to 848 pounds $138 to $144.85.

Boxed beef cutout values closed mixed – lower on Choice and higher on Select on light to moderate demand and offerings.  Choice down $.85 at $209.10 and Select up $.85 at $201.46.  The Choice/Select spread is $7.64.  Estimated cattle slaughter is 120,000 – even on the week and up 1,000 on the year.

Lean hog futures closed sharply higher on fundamental support on the possibility of improving trade relations between the US and China and short covering.  Tomorrow’s session will have expanded limits and we could see follow-through buying push prices higher or profit taking and a drastic drop in prices.  October lean hogs closed limit higher at $55.47 and December contracts also closed limit higher at $52.45.

Cash hogs closed lower with solid negotiated numbers.  Processing margins have improved some, but the sharp decline in wholesale values yesterday and another drop today has buyers trying to push prices lower again today.  The hog supply is ample, but demand uncertainties remain.  However, news broke this morning that China and the US will resume trade negotiations later this month.  That could provide some support to the demand picture.  Barrows and gilts at the Iowa/Southern Minnesota closed $.55 lower with a range of $41.50 to $42.50 for a weighted average of $41.76; the Western Corn Belt closed $.56 lower with a range of $40 to $42.50 for a weighted average of $41.76; the Eastern Corn Belt closed $.43 lower with a range of $40 to $43 for a weighted average of $41.36; and the National Daily Direct closed $.59 lower with a range of $40 to $43 for a weighted average of $41.54.

The Midwest cash markets in Dorchester, WI and Garnavillo, Iowa are closed today.  The market in Zumbrota, MN is not established.  At Illinois, slaughter sow receipts are down on the week and up on the year.  Prices are steady at $20 to $32 with light to moderate demand for moderate offerings.  Barrows and gilts are steady at $19 to $31 with light to moderate demand for moderate offerings.

Pork cutout values closed lower – down $.86 at $67.63.  The ribs, picnics, loins, bellies, and hams were all lower while the butt was firm.  Estimated hog slaughter is 456,000 is down 6,000 on the week and up 10,000 on the year.

 

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