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Direct trade hogs close higher

It was a typical Monday in cattle country with the main item of business the distribution of the new showlists. Early numbers are generally larger than last week with only Texas showing a few less cattle. A few preliminary asking prices have been suggested at 128.00 plus in the South, and 203.00 plus in the North. The kill totaled 123,000 head, 2,000 more than a week ago, but 7,000 below last year.

Boxed beef cutout values were firm on light to moderate demand and light offerings. Choice beef was up .29 at 195.32, and select was .39 higher at 174.59.

Chicago Mercantile Exchange live cattle contracts settled 10 to 37 points higher after trading lower much of the session pressured by concerns that feedlot cash and boxed beef will continue to erode in value. The market reversed at midday and closed higher across the board. December settled .27 higher at 127.00 and February was up .37 at 130.77.

Feeder cattle ended the session from 20 lower to 60 points higher. Feeder cattle followed the live contracts lower with the deferred contracts recovering after the rally in the live pit, but the nearby futures ended in the red.  January settled .02 lower at 145.60, and March was down .20 at 148.22.

Feeder cattle receipts at the Oklahoma National Stockyards totaled 10,000 head on Monday. Compared to last week, feeder steers and heifers were not well established early Steer and heifer calves opened steady to lower. Demand was moderate to good for calves. Feeder steer calves, medium and large 1 weighing 550 to 600 lbs. traded from 145.00 to 153.00. Heifer calves weighing 500 to 575 lbs. brought132.00 to 145.50, with a lot weighing 600 lbs. at 133.50.

Lean hogs settled 15 to 125 points lower on technical issues and commercial selling. The nearby contracts had been higher much of the session while the deferred contracts exhibited weakness for much of the session. December was down .15 at 83.93 and February was 1.25 lower at 85.67.

There was slow to moderate market activity with light demand in the hogs on Monday. Barrows and gilts in the Iowa/Minnesota direct trade closed 1.37 higher at 84.68 on a carcass basis, the West was up .99 at 84.14, and the East was up 1.30 at 81.42. Missouri direct base carcass meat price closed steady from 69.00 to 76.00. Terminal hogs on a live basis were steady to 3.00 higher from 53.00 to 57.00.

Pork trading was very slow, with light demand and light to moderate offerings. Pork carcass cutout value was up .98 at 85.76.

A lot of uncertainty remains as to whether the hog industry is actively engaged in herd liquidation, especially since the sow kill has been running 3.5% smaller than year-ago over the past six weeks of reported data. And if producers hold their numbers together with only small declines in output developing for the spring and summer quarters, deferred lean futures prices could be seriously overpriced at the present time.

Monday’s hog slaughter at 432,000 head was 1,000 less than last week but 6,000 greater than last year.

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