Demand expectations continue to support hog futures
At the Chicago Mercantile Exchange, live and feeder cattle were sharply lower, pressured by the day’s higher move in corn. June live cattle closed $2.27 lower at $113.02 and August live cattle closed $1.72 lower at $116.62. May feeder cattle closed $3.30 lower at $129.75 and August feeder cattle closed $3.62 lower at $143.17.
There was a light to moderate direct cash cattle trade that developed across most feeding areas on Tuesday. Live deals were at $117 to $119, that’s $1 lower to $1 higher than the bulk of last week’s business. Dressed deals in the North were marked at $190, fully steady with last week’s weighted average basis in Nebraska. Asking prices will likely hold firm at $120 live in the South and $192 dressed in the North. Look for more business to develop over the balance of the week.
At the close, at the Joplin Regional Stockyards in Missouri, compared to last week feeder steers and feeder heifers were steady to $2 higher. The USDA says supply was moderate with good demand. Receipts were slightly lower than last week and down significantly on the year. Feeder supply included 52 percent steers and 45 percent of the offering was over 600 pounds. Medium and Large 1 feeder steers 600 to 645 pounds brought $151 to $160 and feeder steers 803 pounds brought $132.75 to $134. Medium and Large 1 feeder heifers 505 to 543 pounds brought $135 to $145 and feeder heifers 705 to 737 pounds brought $125 to $134.
Boxed beef closed higher on good demand for moderate offerings. Choice closed $1.92 higher at $301.22 and Select is $.12 higher at $283.91. The Choice/Select spread is $16. Estimated cattle slaughter is 121,000 head – even on the week and up 36,000 on the year.
Lean hog futures ended the day mostly higher, supported by the sharply higher cash business and long-term demand expectations. But, gains were limited by the drop in cattle. May lean hogs closed $.45 higher at $111.15 and June live cattle closed $.90 higher at $113.55.
Cash hogs closed sharply higher with a big negotiated run. Packers are starting off aggressive in their procurement efforts with sharply higher prices to start the day. The strong demand on both the global market and domestically for US pork has been very supportive to prices, and the industry expects that to continue. Barrows and gilts at the National Daily Direct closed $3.53 higher with a base range of $107.04 to $123 with a weighted average of $115.20; the Iowa/Minnesota closed $3.09 higher with a weighted average of $119.27; the Western Corn Belt closed $2.35 higher with a weighted average of $118.72. Prices at the Eastern Corn Belt were not reported due to confidentiality.
Butcher hog prices at the Midwest cash markets are steady at $70. Pork values closed $.48 lower at $111.18. Hams and picnics were lower. Loins were weak. Bellies, ribs, and butts were all higher.
Estimated hog slaughter is 487,000 head – up 1,000 on the week and up 185,000 on the year. Monday’s hog slaughter has been revised to 488,000 head.