Market News

Hog futures drop on new tariff talk

Chicago Mercantile Exchange live cattle futures were higher, waiting to see how much direct trade is left to be done this week. August was up $.97 at $107.87 and October was $1.07 higher at $108.72.

Feeder cattle were lower on technical selling. August was down $.30 at $141.22 and September was $.92 lower at $141.52.

Direct cash cattle markets were mostly quiet. Very light trade was reported in Nebraska at mostly $183 dressed, steady with last week’s weighted average, with a few sales at $114 live. Light sales were also reported at $111 live in Kansas and $180 to $185 dressed in Iowa. Overall, this week’s business has been light and Friday’s activity could be limited to clean-up trade. Asking prices were $112 to $113 live and $185+ dressed with bids at $111 and $182 to $183 dressed. Weekly beef exports were up on the week, but down from the four-week average.

Boxed beef closed mixed on light to moderate demand for moderate offerings. Choice was up $.70 at $214.24 and Select was down $.35 at $189.34. The estimated cattle slaughter of 121,000 head was steady on the week and up 2,000 on the year.

At the Mitchell Livestock Auction feeder cattle sale in South Dakota, compared to the previous week, steers weighing 800 to 1,000 pounds were $2 to $6 lower. Feeder heifers weighing 700 to 800 pounds were steady to $2 lower and 800 to 1,000-pound heifers were steady to $3 higher. The USDA says demand was good and many load lots were on offer. Medium and Large 1 feeder steers weighing 800 to 900 pounds were reported at $142.25 to $151.50 and Large 1 steers weighing 1,000 to 1,100 pounds sold at $122 to $131.85. Medium and Large 1 feeder heifers weighing 700 to 800 pounds ranged from $133.75 to $144.50 and 900 to 1,000-pound heifers brought $123 to $124.75.

Lean hog futures were sharply lower with expanded trading limits, pressured by the steady to lower cash during the session and President Trump’s statement that new 10% tariffs on $300 billion of goods from China will go into effect September 1st. The President also indicated negotiations will continue. August was down $2.52 at $76.80 and October was $3.52 lower at $67.47.

Cash hogs were steady to sharply lower with relatively light closing negotiated numbers for the national direct market. It’s been an uncertain market for most of the week, with a mixed trend and varying negotiated sales totals. Weekly pork exports were down on the week, with a big cancellation by China mostly cancelling out a significant sales total to Mexico and China also canceled on pork for 2020 delivery, but those cancellations were before this latest round of trade talks. China has reportedly confirmed it will buy more U.S. ag goods ahead of the resumption of trade talks in September. Another case of African Swine Fever was reported in China Thursday. The USDA has revised the way it reports the regional direct barrow and gilt markets because of inconsistent volume and to preserve the confidentiality of individual buyers. Weighted averages will continue to be reported, but not negotiated sales or price ranges. No changes have been made to the national report.

Pork closed $.24 higher at $87.79. Loins, hams, and bellies were firm to higher, with butts, picnics, and ribs lower. The estimated hog slaughter of 472,000 head was up 4,000 on the week and 17,000 on the year.

National direct barrows and gilts closed $2.36 lower at $70 to $84.50 for a weighted average of $78.03, with Iowa/Southern Minnesota down $1.44 at $80.52 and the Western Corn Belt $2.77 lower at $79.18. Butcher hogs at the Midwest cash markets were steady at $48 to $50. Illinois direct sows were firm at $25 to $40 with very good demand for light to moderate offerings. Barrows and gilts were steady at $52 to $58 on good demand for moderate offerings. Boars ranged from $8 to $38.