Market News

Hog futures lower on supply and demand concerns

At the Chicago Mercantile Exchange, cattle futures ended the day mostly firm on support from last week’s higher cash trade and demand expectations.  Feeder cattle closed firm on the same factors with additional support from the weaker move in corn.  December live cattle closed $.40 at $118.70 and February live cattle closed $.12 higher at $125.10.  November feeder cattle closed $.12 higher at $146.37 and January feeder cattle closed $.20 higher at $144.47. 

Direct cash cattle trade activity is off to a quiet start.  Showlists this week appear to be lower across all areas.  Bids and asking prices have yet to surface.  It’s likely significant trade volume will be delayed until at least midweek or even later.  Tyson announced today it would begin receiving cattle at the Holcomb, Kansas facility the first week of December and expects to be running a full capacity by the beginning of January.  Part of the plant has been shut down since the August 9^th fire. 

At midsession, at the Oklahoma National Stockyards, compared to last week feeder steers and heifers were steady to $2 lower.  Steer and heifer calves are trading unevenly steady.  The USDA says demand was moderate to good.  Receipts of 13,400 head was up on the week and the year.  Feeder supply included 58 percent steers and 43 percent of the offering was over 600 pounds.  Medium and Large 1 unweaned feeder steers 461 to 493 pounds brought $160.50 to $165 and feeder steers 754 to 792 pounds brought $140 to $148.  Medium and Large 1 feeder heifers 523 to 540 pounds brought $133 to $142 and feeder heifers 650 to 696 pounds brought $134 to $143. 

Boxed beef closed mixed on light to moderate demand and offerings.  Choice closed $1.68 lower at $239.12 and Select closed $1.26 higher at $215.59.  The Choice/Select spread closed at $23.53.   Estimated cattle slaughter is 118,000 head – up 6,000 on the week and down 2,000 on the year. 

Lean hog futures ended the day lower to sharply lower on the lack of progress on trade talks and concerns about the heavy supply combined with demand uncertainty.  December lean hogs closed $.45 lower at $62.75 and February lean hogs closed $1.77 lower at $70.22. 

Cash hogs closed steady with fairly strong negotiated purchase totals.  The market continues to look for signals that demand for US pork on the global market is going to start significantly improving.  It’s a necessity as the availability of market-ready hogs is ample and slaughter runs continue to hit record or near-record totals almost daily.  Until the demand picture improves, it will be very difficult for prices to turn around and move higher.  Barrows and gilts at the Iowa/Southern Minnesota closed $.25 higher for a weighted average of $41.90; the Western Corn Belt closed $.24 higher for a weighted average of $41.91; the Eastern Corn Belt was not reported due to confidentiality; and the National Daily Direct closed $.10 lower with a base range of $40 to $46 for a weighted average of $42.15.

Butcher hogs at the Midwest cash markets are steady at $36.  At Illinois, slaughter sow prices were $2 lower at $26 to $37 with moderate to good demand for heavy offerings.  Barrow and gilt prices were steady at $25 to $30 with moderate demand for moderate offerings. 

Pork values closed higher – up $1.01 at $89.14.  Hams, ribs, bellies, and picnics closed higher.  Butts were firm.  Loins closed lower.   Estimated hog slaughter is 493,000 head – up 49,000 on the week and up 15,000 on the year.