Market News

Uncertain demand picture pressures nearby lean hogs

At the Chicago Mercantile Exchange, live cattle ended the day mixed on position squaring ahead of Friday’s Cattle on Feed report and the lack of direction from the cash market.  Feeder cattle closed higher with added support from the day’s lower move in corn.  August live cattle closed $.07 lower at $105.55 and October live cattle closed $.35 higher at $107.05.  August feeder cattle closed $.32 higher at $137.25 and September feeder cattle closed $.42 higher at $137.60. 

Another quiet day for direct cash cattle trade.  Bids have surfaced at $109 live in Nebraska and Texas and $175 dressed in Nebraska.  Asking prices are around $112 to $115 live and $185 to $186 dressed.  Wednesday’s Fed Cattle Exchange has an offering of 315 head.  Significant trade volume could be delayed until after Friday’s Cattle on Feed report.   

At the Callaway Livestock Center in Missouri, receipts are up slightly on the week.  Compared to the most recent sale, steer calves 400 to 500 pounds were firm to $5 higher, 500 to 650 pound steers were steady to firm, and 650 to 750 pounds sold with a firm undertone on a light test.  Feeder heifers 450 to 650 pounds were steady to $3 higher and heifers over 650 pounds were lightly tested. The USDA says demand was moderate to good with a moderate supply.  Feeder supply included 41 percent steers and 32 percent of the offering was over 600 pounds.  Medium and large 1 feeder steers 563 to 598 pounds brought $163 to $168.75 and feeder steers 615 to 641 pounds brought $157 to $164.  Medium and Large 1 feeder heifers 452 to 495 pounds brought $149.50 to $159.25 and feeder heifers 556 to 594 pounds brought $144.50 to $152. 

Boxed beef closed weak to lower on light demand and moderate offerings.  Choice closed $1.29 lower at $220.53 and Select closed $.71 lower at $201.80.  The Choice/Select spread closed at $18.73.   Estimated cattle slaughter is 120,000 head – down 2,000 on the week and up 2,000 on the year. 

Nearby lean hog futures ended the day lower as pork supplies are growing and the US seems to be missing opportunities for business with both China and Mexico.  However, rumors that trade talks could be on again with China proved supportive to deferred months.  July lean hogs closed $1.57 lower at $81.47 and August lean hogs closed $.55 lower at $81.70. 

Cash hogs ended the day weak with fairly strong negotiated purchase totals.  The supply and demand picture is the focus of the market right now.  Supplies of ready barrows and gilts are ample and slaughter runs are running strong – which is adding more pork to an already saturated market.  However, the demand picture is less clear.  There is still some expected increase for US pork on the global market as China continues to struggle with African Swine Fever, but the uncertainty surrounding the trade situation is limiting the markets ability to move significantly higher.  Barrows and gilts at the Iowa/Southern Minnesota had no comparison but a base range of $73 to $78 for a weighted average of $76.69; the Western Corn Belt had no comparison but a base range of $67 to $78 for a weighted average of $76.58; the Eastern Corn Belt was not reported due to confidentiality; and the National Daily Direct closed $.46 lower with a range of $67 to $78 for a weighted average of $75.68. 

Butcher hog prices at the Midwest cash markets are steady at $54.  At Illinois, slaughter sow prices were $2 lower at $24 to $38 with light to moderate demand for very heavy offerings.  Barrow and gilt prices were steady at $47 to $51 with moderate demand for moderate offerings. 

Pork values ended the day lower – down $1.82 at $81.15.  Bellies and ribs were sharply lower.  Picnics and hams were lower.  Loins and butts were firm.  Estimated hog slaughter is 477,000 head – up 5,000 on the week and 33,000 on the year.