Market News

Lean hogs higher on oversold bounce

At the Chicago Mercantile Exchange, live cattle futures were higher on optimism ahead of widespread direct cash business and stronger wholesale values.  Nearby feeder cattle were under pressure from the days modest move in corn, but found support in the deferred months on the same factors as the live pit.  August live cattle closed $.47 higher at $107.60 and October live cattle closed $.22 higher at $106.45.  August feeder cattle closed $.42 lower at $139.55 and September feeder cattle closed $.07 lower at $139.37. 

A light direct cash cattle trade developed today.  A few deals were reported in parts of Eastern Nebraska at $183 dressed – those are for a later delivery date.  The rest of cattle country was fairly quiet.  Bids are at $109 live and $181 to $185 dressed and asking prices are at $113+ live and around $185 dressed.  Look for more trade to develop over the balance of the week. 

At the Springfield Livestock Marketing Center in Missouri, receipts are up on the week and down on the year.  Compared to last week, steers and heifers were unevenly steady.  The USDA says demand was moderate and supply was moderate to light.  Feeder supply included 48 percent steers and 40 percent of the offering was over 600 pounds.  Medium and Large 1 feeder steers 580 to 597 pounds brought $152.50 to $157.50 and feeder steers 700 to 743 pounds brought $144.50 to $155.  Medium and Large 1 feeder heifers 568 to 598 pounds brought $133.50 to $143 and feeder heifers 671 to 682 pounds brought $131 to $139. 

Boxed beef closed steady to firm on moderate to fairly good demand and moderate offerings.  Choice closed $.71 higher at $216.49 and Select closed $.06 higher at $192.71.  The Choice/Select spread closed at $192.71.  Estimated cattle slaughter is 118,000 head – down 2,000 on the week and 1,000 on the year. 

Lean hog futures ended the day higher as contracts were oversold and due for a bounce.  Firm wholesale values during the session were also supportive.  Weekly export sales tomorrow will be closely watched following the recent trade tensions with China.  August lean hogs closed $.60 higher at $77.72 and October lean hogs closed $2.25 higher at $66.85. 

Cash hogs ended the day lower with very strong negotiated purchase totals.  The concerns over heavy supply and uncertain demand are weighing heavily on hog prices.  Slaughter runs continue to run well above last year’s totals adding more pork to a market that is already saturated.    The spread of African Swine Fever hasn’t really slowed and there’s expected to be an eventual shortage of pork.  That could be beneficial to US pork prices as demand for pork will rise on the global market – but that’s more of an “if” not “when” scenario.  Barrows and gilts at the Iowa/Southern Minnesota closed $1.27 lower for a weighted average of $74.25; the Western Corn Belt closed $1.41 lower for an average of $74.07; the Eastern Corn Belt closed $.81 lower for a weighted average of $73.35; and the National Daily Direct closed $1.51 lower with a range of $64 to $78 for a weighted average of $73.61. 

Butcher hogs at the Midwest cash markets are steady at $62 in Dorchester, Wisconsin and Garnavillo, Iowa and are $2 higher in Red Oak, Iowa at $55.

Pork values closed weak – down $.33 at $88.40.  Hams, butts, and loins were all lower to sharply lower.  Picnics, ribs, and bellies were higher to sharply higher.  Estimated hog slaughter is 472,000 head – up 2,000 on the week and up 8,000 on the year.