Market News

Iowa hog weights unseasonably heavy due to mild weather

Chicago Mercantile Exchange live cattle contracts settled 35 to 62 points higher on bull spreading and short covering as traders waited for cash business to develop. Additional support came from the impressive strength in the stock market. Deferred issues received an additional boost from the rally in corn futures. August was up 62 points at 84.57, and October finished 60 higher at 89.85. Boxed beef cutout values were weak on light to moderate demand and offerings. Choice beef was down .43 at 142.26 and select was down .18 at 136.82.

Feeder cattle contracts finished 10 to 70 points higher. Bear spreading was evident in the front months. Moderate strength was seen in the deferred issues due to the relative premium of the cash index. August closed 10 points higher at 102.12, and September was up 22 at 102.27.

Feeder cattle receipts at the Bassett Livestock Auction, Bassett, NE totaled 3840 head. Compared with two weeks ago steers and heifers trended steady to firm. Demand was very good and trading was called active. Feeder steers medium and large 1, 291 head weighing 884 traded at 101.88, 186 heifers averaging 875 lbs brought 96.90 per hundredweight.

Cattle slaughter was estimated at 127,000 head, 2,000 less than last week, but 4,000 more than last year.  The cash cattle market was not tested on Thursday afternoon as bids at 80 to 82 in the South were considerably under asking prices of around 85. In Nebraska cattle buyers were bidding 130 to 131, but producers were asking 135. A very slow trade was evident in Iowa/Minnesota and Nebraska at 82.00 to 83.50 live and 130 to 132 dressed, but not enough for an adequate market trend. It could be afternoon on Friday before significant trade develops.

Hog slaughter was estimated at 415,000 head, 5,000 less than last Thursday and last year. Terminal barrows and gilts were steady to weak with an instance of a 1.00 lower from 33.00 to 40.00 on a live basis. The Missouri direct base carcass meat price was steady to 1.00 lower from 49.00 to 52.00. Barrows and gilts in the Iowa/Minnesota direct trade closed .94 lower at 53.68, the West was .90 lower at 53.97, and the East closed at 53.12 down .86.  Iowa/Minnesota barrows and gilts last week were unseasonably heavy at 266.3 lbs, .01 lbs heavier than the week before and 7 lbs more than last year. Mild summer temperatures continue to underwrite outstanding performance and weight gains according to DTN’s John Harrington. Friday’s cash bids are expected to be weak to lower.

Lean hogs settled 42 higher to 212 points lower with August hit hard by the poor showing of the fundamentals. December and the 2010 contracts were better supported by bear spreading and the surge in corn prices on the Board of Trade. August settled 212 points lower at 54.62, and October was down 50 at 52.60. Pork trading was slow to moderate, with mostly light demand and moderate offerings. The Pork carcass cutout value was down .45 at 59.09.

Pork bellies finished the session 55 to 115 points lower pressured by fears of greater production ahead and lower bacon sales. August was down 55 at 61.00, and February was off 115 points at 81.37.