Market News

Hog futures close lower on demand uncertainties

At the Chicago Mercantile Exchange, live and feeder cattle futures closed higher on follow-through buying.  Feeder cattle found additional support in the day’s lower move in corn.  October live cattle closed $2.35 higher at $98.50 and December live cattle closed $2.40 higher at $103.62.  September feeder cattle closed $2.17 higher at $136.07 and October feeder cattle closed $2.97 higher at $134.02. 

Direct cash cattle trade activity has improved some, but there are just a few scattered bids on the table.  There were a handful of deals reported in Kansas at $99 live and in Nebraska at $157 to $160 dressed.  But that isn’t near enough to establish a trend.  Bids in the South are at $97 to $98 live and $100 live in Nebraska.  Dressed bids in the North at $157.  Asking prices are at $100 live in the South and $165 to $168 dressed in the North.  Significant trade volume isn’t like to develop until sometime Thursday or Friday.

At the Ozarks Regional Stockyard in Missouri, receipts are up on the week and down on the year.  Compared to last week, steer calves traded $3 to $6 lower with spots of $8 lower while heifer calves traded steady to $4 lower.  Yearling steers were $3 to $4 lower with yearling heifers not well tested.  The USDA says demand was light early and improved throughout the day.  The supply was moderate and included several pot-loads of 8 and 9 weight steers.  Feeder supply included 57 percent steers and 43 percent of the offering was over 600 pounds.  Medium and Large 1 feeder steers 600 to 640 pounds brought $138 to $146 and feeder steers 706 to 740 pounds brought $132.50 to $140.  Medium and Large 1 feeder heifers 450 to 494 pounds brought $128 to $139 and feeder heifers 555 to 595 pounds brought $128 to $138.

Boxed beef closed sharply lower on light demand and moderate to heavy offerings.  Choice closed $5.49 lower at $219.89 and Select closed $2.58 lower at $198.40.  The Choice/Select spread is $21.49.  Estimated cattle slaughter is 117,000 head – even on the week and down 3,000 on the year. 

Lean hog futures ended the day lower on the news that China would keep tariffs on US pork in place and the continued weak cash trade.  October lean hogs closed $2.55 lower at $60.17 and December lean hogs closed $.57 lower at $61.20. 

Cash hogs closed lower with large negotiated purchase totals.  Supply and demand continue to drive the market.  The availability of market-ready hogs is ample, and the very large slaughter runs continue.  That is adding more pork to a market that is already saturated.  Buyers and sellers have remained hopeful that demand for US pork would increase on the global market, but the reality is it hasn’t.  And with China not dropping tariffs on US pork, prices continue to be under pressure. Barrows and gilts at the Iowa/Southern Minnesota closed $1.15 lower for a weighted average of $47.56; the Western Corn Belt closed $1.29 lower for a weighted average of $47.44; the Eastern Corn Belt was not reported due to confidentiality; and the National Daily Direct is $1.50 lower with a base range of $44 to $54 for a weighted average of $47.27. 

At Illinois, slaughter sow prices were weak at $25 to $29 with light to moderate demand for heavy offerings.  Barrow and gilt prices were $1 to $3 lower at $26 to $35. 

Pork values closed firm – up $.46 at $72.45.  Picnics, bellies, and ribs are all higher.  Loins and hams are weak.  Butts closed lower.  Estimated hog slaughter is 487,000 head – up 2,000 on the week and up 77,000 on the year.