Market News

Hogs higher, supported by pork demand

Chicago Mercantile Exchange live cattle futures were higher on short covering as the trade gets ready for this week’s direct cash cattle business. That was despite another big drop in boxed beef at midday and another slow week at the Fed Cattle Exchange. June was up $.65 at $120.25 and August was $.60 higher at $115.62.

Feeder cattle futures were higher, covering shorts and getting ready for this week’s direct business, with additional support from the weak trade in corn. August was $1.52 higher at $146.40 and September was up $1.87 at $146.40.

Direct cash cattle markets were mostly quiet at midweek. DTN says a handful of sales were reported at $190 and $191 on the dressed basis in Iowa and Nebraska, respectively. A few bids were on the table in Nebraska at $117 live. Widespread activity isn’t expected until Thursday or Friday.

Boxed beef closed sharply lower on light to moderate demand and heavy offerings. Choice was down $4.48 at $229.43 and Select was $2.59 lower at $212.67. The estimated cattle slaughter was 118,000 head, unchanged from a week ago and 4,000 more than a year ago.

At the Hub City Livestock Auction in Aberdeen, South Dakota, trade this week was in different weight classes than last week, so there wasn’t an accurate trend, but a lower undertone was noted for steers and heifers. Demand was good, with the offering largely package and loads, mostly home raised. Lighter weight cattle mostly had light to moderate flesh and the heavier weights had moderate plus flesh, with the occasional instance of heavy flesh. The USDA says quality was attractive and the market was active. 51% of the offering was heifers and 97% of all animals weighed more than 600 pounds. No sale next Wednesday because of Independence Day. 900 to 985 pound feeder steers sold at $137.60 to $145. 650 to 700 pound heifers brought $149 to $159.25 and 980 to 990 pound heifers ranged from $124 to $125.25.

It was another light week for Fed Cattle Exchange. The offering was 2,554 head, but only 480 sold. 320 head sold for 1 to 9 day delivery, with a weighted average of $119.51, and 160 head sold for 1 to 17 day delivery with a weighted average of $120.00.

Lean hog futures were higher, supported by contracts’ discount to the cash index and the higher midday pork. How much longer that pork strength will continue is a question mark. Seasonal factors are in pork’s favor, but there’s a lot of product on the market. The USDA’s quarterly hogs and pigs report is out Friday and expected to show year to year increases in most of the major categories. July was $1.45 higher at $87.92 and August was up $.92 at $79.47.

Cash hogs were mixed, depending on packer demand. The trade’s got some demand uncertainties ahead of the July 4th holiday, for both the availability of market ready numbers and wholesale demand.

Iowa/Southern Minnesota direct barrows and gilts were $.07 lower at $81 to $87.50 for a weighted average of $86.37, the Western Cornbelt was down $.11 at $81 to $87.50 with an average of $86.27, and national direct business was $.22 lower at $81 to $87.50 for an average of $85.59. The Eastern Cornbelt had no recent comparison with a range of $84 to $86 and a weighted average of $84.97. Butcher hogs at the Midwest cash markets were steady to $5 higher at $58 to $66. Missouri direct butchers were steady at $78 to $81 on light to moderate supply and demand. Sows were steady to $2 lower at $40 to $48. Illinois direct sows were steady at $48 to $60 on very good demand for heavy offerings. Barrows and gilts were steady at $59 to $62 with good demand for moderate offerings. Illinois boars ranged from $10 to $40. The average Iowa/Southern Minnesota hog weight for the week ending June 24th was 276.9 pounds, down 0.6 on the week and 0.9 on the year.

The pork cutout closed $1.23 higher at $103.54. Hams were weak, all other primals were firm to sharply higher, including a $6.74 jump in ribs. The estimated hog slaughter of 437,000 head was up 1,000 on the week and 8,000 on the year.