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Lean hogs end sharply higher on export news

There was very little action in cattle country on Wednesday afternoon with just a few bids on the table at 121.00 live and 195.00 on a dressed basis. Feedlot operators appear firm in their resolve with asking prices 126.00 plus in the South and 200.00 plus in the North. With a separation of 5.00 between bids and asking prices it may be as late as Friday before significant trade volume surfaces. The kill totaled 119,000 head, the same as last week, but 4,000 smaller than last year.

Boxed beef cutout values closed weak on the choice and firm on select on light demand and light to moderate offerings. Choice boxed beef was down .39 at 195.78, and select was up .67 at 175.34.

Live cattle contracts on the Chicago Mercantile Exchange settled 45 points higher to 20 lower. Price movement was mixed through much of the session as traders focused on potential stability in beef values while uncertain about the aggressive gains that developed on Tuesday. Most of the pressure was attributed to profit taking after some traders felt the early week gains too aggressive for any fundamental shifts seen in the beef market. December settled .20 lower at 126.35, and February was down .15 at 131.80.

 Feeder cattle ended unchanged to 67 points higher as light to moderate support redeveloped following the weakness in the corn market as well as expected support in wholesale beef values and stable to growing demand. January feeders settled .67 higher at 152.70, and March was up .35 at 154.72.

Loup City Livestock Auction, Loup City, Nebraska had receipts of 2200 cattle on Tuesday. Compared to two weeks ago, steers weighing less than 550 lbs. sold 10.00 to 20.00 higher, over 550 lbs. sold steady to 5.00 higher. Heifers were 2.00 to 5.00 higher. Demand was good from start to finish from a large crowd of buyers. The majority of the sale consisted of top quality home raised calves; most were weaned with all shots. Feeder steers, medium and large 1 averaging 573 lbs. traded at 160.74 per hundredweight. 574 lb. heifers averaged 149.50.

Lean hogs settled 90 to 150 points higher with the exception of the spot month with traders moving out of the soon to expire December futures and into February and  April contracts. Futures maintained a narrow trading range for much of the session until news reached the market that pork exports were 8.7 percent higher in October 2012 than in 2011 according to the Meat Export Federation. Lighter carcass weights are also viewed as positive, in the face of strong demand. December was .02 lower at 82.07, but February was up 1.50 at 85.65.

Barrows and gilts in the Iowa/Minnesota direct trade closed .97 higher at 78.93 on a carcass basis, the West was up .73 at 78.68, and the East was down 1.12 at 77.73. Missouri direct base carcass meat price was down 1.00 from 71.00 to 77.00. Terminal hogs closed steady to 1.00 lower from 50.00 to 57.00 on a live basis.

Pork trading was moderate with light to moderate demand and offerings. Pork carcass cutout value was down .83 at 83.58.

The hog kill was estimated at 233,000 head, the same as last week, but 2,000 more than last year. The Saturday kill is now estimated to be around 150,000 head, the smallest effort seen in months. Most packers appear to have adequate supplies to carry them through the week and the Thursday cash market looks weak to lower.

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