Market News

Lean hogs continue to push higher

At the Chicago Mercantile Exchange, live cattle futures closed lower on profit taking and the lack of direction in the cash trade.  Feeder cattle futures were lower on the same factors with additional pressure from the days higher move in corn.  August live cattle closed $.50 lower at $107.62 and October live cattle closed $.32 lower at $108.97.  August feeder cattle closed $.52 lower at $142.35 and September feeder cattle closed $.27 lower at $142.85. 

Direct cash cattle trade activity was at a standstill.  Bids were at $180 dressed in Nebraska.  Asking prices are at $113 to $114 live and $184+ dressed.  While packer inquiry is expected to improve, significant trade volume isn’t expected until sometime Thursday or Friday. 

At the Hub City Livestock Auction in South Dakota, receipts are up on the week and almost steady on the year.  Compared to the most recent sale, the best test was on steers 950 to 1050-pounds and they were $8 to $10 higher.  The best test on heifers 900 to 950 pounds were $3 to $4 higher.  The USDA says demand was good for the offering which featured several strings and loads of backgrounded cattle as well as packages of home-raised cattle which all sold on an active market.  Most of the cattle were in moderate-plus flesh with some heavy flesh at times.  Feeder supply included 53 percent steers and 95 percent of the offering was over 600 pounds.  Medium and large 1 feeder steers 758 to 795 pounds brought $145.25 to $156.50 and feeder steers 951 to 997 pounds brought $136 to $141.90.  Medium and Large 1 feeder heifers 905 to 944 pounds brought $123.25 to $126.50 and feeder heifers 960 to 997 pounds brought $118 to $125. 

Boxed beef closed weak to lower on light to moderate demand and moderate to heavy offerings.  Choice closed $.31 lower at $214.42 and Select closed $1.20 lower at $190.98.   Estimated cattle slaughter is 119,000 head – down 3,000 on the week and up 1,000 on the year. 

The momentum continued as lean hog futures ended the day higher.  Strong cash trade along with the optimism surrounding the demand picture helped to push prices higher again today.  July lean hogs closed $.37 higher at $71.75 and August lean hogs closed $2.65 higher at $81.27. 

Cash hogs closed firm to higher with moderate to heavy negotiated purchase totals.  The market has struggled to find direction – either from the heavy supplies or the potential spikes in demand.  The availability of market-ready hogs looks to be more than ample in the long-term and the heavy supplies could pressure prices.  While there is optimism that demand for US pork will increase, that has yet to be realized preventing prices from moving higher.  Should demand start to shore-up – we could see the momentum of the market shift.  Barrows and gilts at the Iowa/Southern Minnesota closed $1.36 higher with a range of $67 to $70 for a weighted average price of $69.17; the Western Corn Belt had no comparison with a range of $56 to $70 for a weighted average of $69.89; the Eastern Corn Belt had no comparison with a range of $65.22 to $68.50 for a weighted average of $65.98; and the National Daily Direct closed $.64 higher with a range of $56 to $70 for a weighted average of $67.60. 

Butcher hog prices at the Midwest cash markets are steady at $40 to $44.  At Illinois, slaughter sow prices were steady at $20 to $32 with moderate demand for heavy offerings.  Receipts were up on the week. Barrow and gilt prices were firm at $40 to $46 with moderate demand for moderate offerings. 

Pork values closed sharply lower – down $2.17 at $71.60.  Bellies dropped $9.32.  Loins and butts were lower.  Hams were weak.  Picnics and ribs were steady.  Estimated hog slaughter is 478,000 head – down 2,000 on the week and up 19,000 on the year.