Market News

Hog futures higher on demand expectations

At the Chicago Mercantile Exchange, cattle futures ended the day modestly higher ahead of widespread direct cash business.  Monday’s beef prices were supportive and continued strong demand could help keep prices elevated despite the recent back to back negative reports.  October live cattle closed $.17 higher at $112.35 and December live cattle closed $.20 higher at $117.20.  September feeder cattle closed $.17 higher at $156.62 and October feeder cattle closed $.17 higher at $156.47.

Direct cash cattle trade has been quiet.  There are few dressed bids noted in Nebraska at $172 and in Iowa at $174.  Asking prices have not yet been fully established.  Wednesday’s Fed Cattle Exchange has an offering of 424 head.  Significant trade volume isn’t expected to develop until the latter part of the week.

At the Tri-State Livestock Auction in Nebraska, receipts are down on the week, but up significantly on the year.  Compared to last week, steer calves sold $6 to $10 higher and heifer calves were steady.  The USDA says demand was good from start to finish.  Feeder supply included 60 percent steers and 22 percent of the offering was over 600 pounds.  Medium and Large 1 feeder steers 456 to 494 pounds brought $197 to $210 and feeder steers 564 to 597 pounds brought $180 to $191.  Medium and Large 1 feeder heifers 465 to 496 pounds brought $168 to $173 and feeder heifers 558 to 594 pounds brought $153.50 to $163.75.

Boxed beef cutout values closed weak on light to moderate demand and moderate offerings.  Choice closed $.43 lower at $205.73 and Select closed $.52 lower at $194.87.  Estimated cattle slaughter is 120,000 head – even on the week and up 1,000 on the year.

Lean hog futures closed higher on fundamental factors.  Support from the recently higher wholesale values has also been helpful.  The market continues to watch the African Swine Fever situation as it has the potential to bring significant changes to the global pork market.  Nearby contracts have outgained deferred months.  October lean hogs closed $1.42 higher at $62.42 and December contracts closed $.77 higher at $57.75.

Cash hogs closed sharply higher.  Pork processors are aggressively working to keep plants full – even if that means increasing bids to ensure it happens.  Plants have been running at exceptionally high chain speeds to make up for last week’s slowdown in the Southeast.  Looking ahead to Thursday’s Hogs and Pigs report, another record inventory is expected.  Barrows and gilts at the Iowa/Southern Minnesota closed $1.56 higher with a range of $54 to $64.50 for a weighted average of $63.14; the Western Corn Belt closed $1.55 higher with a range of $54 to $64.50 for a weighted average of $63.13; the Eastern Corn Belt was not reported due to confidentiality; and the National Daily Direct opened $1.90 higher with a range of $54 to $64.50 for a weighted average of $62.50.

Butcher hogs at the Midwest cash markets are $3 higher at $39.  At Illinois, slaughter sow receipts are up on the week and the year.  Prices are $1 higher at $18 to $30.  Barrows and gilts are $2 higher at $33 to $44 with moderate demand for moderate offerings.

Pork cutout values closed firm – up $.43 at $80.45.  The primals are mostly higher, led by the bellies.  However, the picnics closed more than $2 lower.  Estimated hog slaughter is 472,000 head – up 50,000 on the week and 10,000 on the year.