Market News

Demand hopes push hog futures higher

At the Chicago Mercantile Exchange, live cattle futures ended the day firm ahead of widespread direct cash trade and support from higher wholesale values.  Feeder cattle closed mixed to mostly higher on spread trade.  October live cattle closed $.37 higher at $111 and December live cattle ended the day unchanged at $113.45.  October feeder cattle closed $.55 lower at $145 and November feeder cattle ended the day unchanged at $146.07. 

Direct cash cattle trade remains at a standstill.  Bids have yet to surface and we’ve only seen a few asking prices surface in parts of Nebraska at $115 live and $180 dressed.  Wednesday’s Fed Cattle Exchange has an offering of 776 head.  But it’s likely significant trade volume will be delayed until the latter half of the week.

At the Tri-State Livestock Auction in Nebraska, receipts are up on the week and the year.  Compared to last week’s sales, steers under 700 pounds were steady to $6 lower and heifers under 700 pounds were steady to $3 lower.  There was no comparison on 700-pound and above.  The USDA says demand was good to moderate for the day’s offering.  Feeder supply included 51 percent steers and 27 percent of the offering was over 600 pounds.  Medium and Large 1 feeder steers 452 to 499 pounds brought $167 to $178.50 and feeder steers 552 to 598 pounds brought $151 to $160.50.  Medium and Large 1 feeder heifers 500 to 547 pounds brought $140 to $154.50 and feeder heifers 807 to 840 pounds brought $131.50 to $138.25. 

Boxed beef closed higher on Choice and sharply higher on Select on moderate to good demand and moderate offerings.  Choice closed $.80 higher at $218.02 and Select closed $2.15 higher at $191.48.  The Choice/Select spread closed at $26.54.  Estimated cattle slaughter is 118,000 head, up 1,000 on the week and down 3,000 on the year. 

Lean hog futures closed higher on potential demand increases, higher wholesale values during the session, and the recently higher cash trade.  December lean hogs closed $3 higher at $72.12 and February lean hogs closed $1.90 higher at $79.15.

Cash hogs closed firm to higher with extremely large negotiated purchase totals.  Packers worked hard to move their desired numbers.  The demand potential is helping to keep prices supported.  The industry is counting on big demand increases as the supply of market-ready hogs remains more than ample and slaughter totals continue to push higher.  If the demand potential isn’t realized, it could easily send hog prices tumbling.  Barrows and gilts at the Iowa/Southern Minnesota closed $.84 higher for a weighted average of $59.82; the Western Corn Belt closed $.94 higher for a weighted average of $59.75; the Eastern Corn Belt closed $.62 higher for a weighted average of $57.75; and the National Daily Direct closed $1.08 higher with a base range of $53 to $62 for a weighted average of $59.24. 

Butcher hog prices at the Midwest cash markets are $4 higher at $40.  At Illinois, slaughter sow prices were $4 higher at $22 to $34 with moderate to good demand for heavy offerings.  Barrow and gilt prices were firm at $34 to $39 with good demand for moderate offerings. 

Pork values closed steady – up $.12 at $78.06.  Hams and butts were sharply higher.  Ribs closed firm.  Bellies, loins, and picnics were all weak to lower.  Estimated hog slaughter is 490,000 head, up 1,000 on the week and 11,000 on the year.