Market News

Lean hogs higher on an oversold bounce

At the Chicago Mercantile Exchange, live cattle ended the day mixed on spread adjustments ahead of widespread direct cash business.  Feeder cattle were mostly higher on stronger demand expectations for the end of the year.  December live cattle closed $.20 lower at $120.55 and February live cattle closed $.15 lower at $125.65.  January feeder cattle closed $.22 higher at $142.92 and March feeder cattle closed $.10 lower at $142.92. 

Direct cash cattle trade remains quiet.  Bids have yet to surface and asking prices are at $122 live in the South and $193 plus, dressed in the North.  It’s looking like significant trade volume will be delayed until the latter half of the week.  Wednesday’s Fed Cattle Exchange has an offering of 1,189 head. 

At the Callaway Livestock Center in Missouri, compared to last week, lightweight steers were $6 to $8 higher, 5-weight steers sold firm to $5 higher, and steers over 600 pounds were not well tested.  Feeder heifers weighing 400 to 500 pounds sold $4 to $6 higher on a light test, 5-weight heifers were mostly $2 to $5 higher on comparable sales and heifers over 600 pounds sold steady to firm.  Receipts of 2,341 head were down on the week.  Feeder supply included 60 percent steers and 50 percent of the offering was over 600 pounds.  Medium and Large 1 feeder steers 500 to 549 pounds brought $162 to $173.50 and feeder steers 600 to 648 pounds brought $145 to $150.75.  Medium and Large 1 feeder heifers 511 to 544 pounds brought $138.50 to $145 and feeder heifers 601 to 616 pounds brought $135.50 to $140. 

Boxed beef closed weak to lower on light demand for heavy offerings.  Choice closed $2.46 lower at $230.15 and Choice closed $.67 lower at $212.31.  The Choice/Select spread closed at $17.84.  Estimated cattle slaughter is 120,000 head – up 13,000 on the week and even on the year.  Monday’s cattle slaughter has been revised to 120,000 head. 

Lean hog futures ended the day higher on support from higher cash trade and contracts oversold and due for a bounce.  December lean hogs closed $2.15 higher at $62.50 and February lean hogs closed $2.22 higher at $68.37. 

Cash hogs closed higher with strong negotiated purchases.  Packer margins have been increasing and it’s giving them a little more wiggle room to bid up in order to move their desired numbers.  The industry continues to be plagued by heavy supplies and slaughter runs are creeping higher.  As long as there is a place to move the US pork, prices have room to move higher.  But until the cash market starts seeing significantly higher volumes of pork moving onto the global market, it will be very difficult for prices to move higher for a significant amount of time. Barrows and gilts at the Iowa/Southern Minnesota closed $1.37 higher for a weighted average of $45.01; the Western Corn Belt closed $1.52 higher for a weighted average of $45; the Eastern Corn Belt was not reported due to confidentiality; and the National Daily Direct closed $1.26 higher with a base range of $40 to $46.50 for a weighted average of $44.80. 

Butcher hog prices in Dorchester, Wisconsin are steady at $32.  The market at Garnavillo, Iowa is closed today.  At Illinois, slaughter sow prices were steady at $23 to $34 with moderate to good demand for heavy offerings.  Receipts are down on the week and up on the year.  Barrow and gilt prices were steady at $25 to $30 with moderate demand for moderate offerings. 

Pork values closed lower – down $2.25 at $80.61.  Bellies dropped nearly $10 today.  Loins and butts were also lower.  Picnics and hams were steady to weak.  Ribs closed firm.  Estimated hog slaughter is 495,000 head – up 7,000 on the week and up 15,000 on the year.