Market News

Hog futures continue their surge on demand hopes

At the Chicago Mercantile Exchange, cattle futures ended the day higher on optimism ahead of the cash trade and spillover support from the surging lean hog futures.  Cattle on Feed and Cold Storage numbers come out Friday afternoon.  April live cattle closed $.32 higher at $129.90 and June contracts closed $.52 higher at $123.90.  April feeder cattle closed $.60 higher at $148.92 and May feeder cattle closed $1.87 higher at $154.00. 

Direct cash cattle trade is at a complete standstill.  Bids started to surface at $126 live in Texas and $204 dressed in Nebraska.  Asking prices are holding firm at $130 to $132 live and $210 dressed.  Significant trade volume will likely hold off until after the latest Cattle on Feed report which comes out Friday.

At the Clovis Livestock Auction in New Mexico, receipts are up on the week and the year.  Compared to the last sale steer and heifer calves under 600 pounds are $3 to $6 higher with instances of $8 to $9 on value added offerings.  Over 600 pounds $1 to $2 higher with instances of $3 higher on 600 to 700 pounds steers.  Trade was very active and demand was very good on calves and moderate on feeders.  Feeder supply included 61 percent steers and 66 percent of the offering was over 600 pounds.  Medium and Large 1 feeder steers 750 to 796 pounds brought $133.75 and $141.75.  Medium and Large 1 feeder heifers 701 to 740 pounds brought $127.50 to $133.

Boxed beef closed mixed – firm on Choice and Weak on Select on moderate to fairly good demand and moderate offerings.  Choice is $.64 higher at $229.31 and Select is $.26 lower at $218.37.  The Choice/Select spread is $10.94.  Estimated cattle slaughter is 121,000 head – up 22,000 on the week and even on the year. 

Lean hog futures closed sharply higher in the expanding trading range supported by the sharply higher wholesale values and the continued strength in the cash trade.  China is the main driver behind the surge in the hog market as the country is having to turn to the global market to meet their pork needs.  April lean hogs closed $4.50 higher at $78.32 and May contracts closed $4.45 higher at $86.60. 

Cash hogs closed sharply higher with strong negotiated purchase totals.  China continues to be the driving force behind the pork market’s surge higher.  As African Swine Fever continues to spread throughout Asia, China is having to turn to the global market to import enough pork to meet their country’s needs.  That includes the US.  All of this increased demand is good news – especially as the supply of ready barrows and gilts remains more than ample.  Barrows and gilts at the Iowa/Southern Minnesota closed $4.08 higher with a range of $60 to $68 for a weighted average of $66.22; the Western Corn Belt closed $3.71 higher with a range of $55 to $68 for a weighted average of $65.48; the Eastern Corn Belt had no comparison but traded in a range of $57 to $62.26 for an average of $60.35; and the National Daily Direct closed $2.79 higher with a range of $54 to $64 for a weighted average of $60.38. 

Butcher hogs at the Midwest cash markets are steady at $40.  At Illinois, slaughter sow prices are steady at $28 to $43 with light to moderate demand for light offerings.  Receipts are up on the week and down on the year.  Barrow and gilt prices are steady at $35 to $42 with good demand for moderate offerings. 

Pork values closed higher – up $2.20 at $76.25.  Loins and bellies were sharply higher.  Hams, picnics, and butts were higher to firm.  Ribs closed lower.   Estimated hog slaughter is 478,000 head – up 31,000 on the week and up 26,000 on the year.