Market News

Lean hog futures higher on trade talks

At the Chicago Mercantile Exchange, live cattle futures closed mostly higher in a narrow trading range on optimism ahead of this week’s cash trade.  Feeder cattle futures closed higher on the same factors – plus some position squaring based on estimates ahead of Thursday’s Cattle on Feed report.  April live cattle closed $.25 lower at $126.30 and June live cattle closed $.02 higher at $121.47.  April feeder cattle closed $.25 higher at $145.67 and May feeder cattle closed $.52 higher at $151.02. 

Direct cash cattle trade activity is non-existent to start the week.  Bids and asking prices have yet to surface.  This week’s showlists appear to be mostly higher – except for Colorado, which is lower.  It’s likely significant trade volume will be delayed until the latter part of the week. 

At the Joplin Regional Stockyards in Missouri – receipts are down on the week and the year.  Compared to last week, steer calves are steady and heifer calves are steady to firm.  There were too few yearlings sold early for an accurate price test.  The USDA says demand was good and supply was moderate.  Feeder supply included 39 percent steers and 25 percent of the offering was over 600 pounds.  Medium and Large 1 feeder steers 565 to 577 pounds brought $157 to $165 and feeder steers 722 to 741 pounds brought $148.50 to $155.  Medium and Large 1 feeder heifers 505 to 542 pounds brought $142.50 to $153 and feeder heifers 612 to 645 pounds are at $142.50 to $147. 

Boxed beef closed steady on Select and higher on Choice on moderate to good demand and moderate offerings.  Choice closed $2.23 higher at $230.98 and Select closed $.20 higher at $221.22.  The Choice/Select spread closed at $9.76.  Estimated cattle slaughter is 121,000 head – up 1,000 on the week and up 6,000 on the year. 

Lean hog futures closed mostly higher on optimism surrounding current trade talks between both the US and China and the US and Japan.  And the fact that China continues to battle African Swine Fever and is buying more pork from the global market.  May lean hogs closed $.47 higher at $90.07 and June lean hogs closed $.20 lower at $98.30. 

Cash hogs closed steady to higher with moderate negotiated purchase totals.  The market has factors pulling it in different directions.  The supply of ready barrows and gilts is ample, and slaughter runs, for the most part have been running well above year-ago totals.  That adds a lot of pork to an already saturated market.  But – there’s a lot of optimism surrounding demand.  Trade talks between the US and Japan are underway this week and the Treasury Secretary has indicated talks between the US and China are getting close to the end.  Both represent significant demand potential.  And there’s China’s ongoing battle with African Swine Fever and the country’s need to turn to other markets to meet their pork needs.  Barrows and gilts at the Iowa/Southern Minnesota closed $.90 higher with a range of $67 to $78.50 for a weighted average of $77.84; the Western Corn Belt closed $1.09 higher with a range of $67 to $78.50 for a weighted average of $77.42; the Eastern Corn Belt was not reported due to confidentiality; and the National Daily Direct closed $.13 higher with a range of $67 to $78.50 for a weighted average of $76.38.

Butcher hog prices at the Midwest cash markets are $3 to $6 higher at $60. At Illinois, slaughter sow prices are $3 to $4 higher at $40 to $53 with good demand for light offerings.  Receipts are down on the week and the year.  Barrow and gilt prices are $2 lower at $46 to $54 with moderate demand for moderate offerings. 

Pork values ended the day higher – up $1.33 at $87.04.  Bellies closed $7.39 higher.  Ribs, butts, and hams were all higher to sharply higher.  Picnics and loins were weak to lower. Estimated hog slaughter is 436,000 head – down 39,000 on the week and down 25,000 on the year.