Hog futures higher on oversold signals
At the Chicago Mercantile Exchange, live cattle ended the day lower on follow-through selling, weakness in the cash market, and lower wholesale values. Feeder cattle closed higher, contracts were oversold and due for a bounce with support from the weaker move in corn. February live cattle closed $.95 lower at $114.07 and April live cattle closed $.60 lower at $112.35. March feeder cattle closed $1.10 higher at $134.07 and April feeder cattle closed $1.85 higher at $135.97.
Direct cash cattle trade activity remains quiet headed into the back half of the week. There have been just a few scattered bids on the table in the North at $184 to $188. After the light to moderate trade that took place on Tuesday, the majority of this week’s cattle business could be completed already, and we could just see some cleanup deals over the balance of the week. Asking prices for cattle left on showlists are at $117 plus in the South and $187 plus in the North.
At the Kingsville Livestock Auction in Missouri, compared to last week steers sold mostly $3 to $5 lower with spots of up to $10 lower on the 500 to 550-pound steers. Heifers sold steady to $4 lower. The USDA says demand remained good for calves and moderate for yearlings. Supply was moderate to heavy. Receipts were down on the week. Feeder supply included 43 percent steers and 40 percent of the offering was over 600 pounds. Medium and Large 1 feeder steers 724 to 748 pounds brought $143 to $147.50 and feeder steers 853 to 863 brought $127.10 to $141. Medium and Large 1 feeder heifers 463 to 498 pounds brought $153 to $164 and feeder heifers 552 to 88 pounds brought $143 to $156.50.
Boxed beef closed lower on light demand and heavy offerings. Choice closed $1.13 lower at $206.34 and Select closed $1.30 lower at $198.60. The Choice/Select spread is $7.74. Estimated cattle slaughter is 123,000 head – up 1,000 on the week and 4,000 on the year.
Lean hog futures ended the day higher on oversold signals and in anticipation of the Weekly Export Sales Report. April lean hogs closed $.47 higher at $65.15 and May lean hogs closed $.20 higher at $72.17.
Cash hogs closed mixed with heavy negotiated purchases. The industry remains optimistic demand for US pork will see a significant boost on the global market despite some obvious pressure points. There is uncertainty surrounding the overall demand impact the coronavirus has had on China’s demand for pork, the US faces increased competition for the Chinese market from Brazil, and supplies of US pork are increasing and that isn’t expected to change anytime soon. Domestic demand has remained relatively strong – and that will likely need to continue to keep the market supported. Barrows and gilts at the National Daily Direct closed $.42 higher with a base range of $45 to $52 for a weighted average of $50.02; the Iowa/Minnesota closed $.14 higher for a weighted average of $49.69; the Western Corn Belt closed $.09 higher for a weighted average of $49.40; the Eastern Corn Belt closed $.99 higher for a weighted average of $50.72.
Butcher hog prices at the Midwest cash markets are $1 higher at $31. At Illinois, slaughter sow prices were firm with good demand for moderate offerings at $17 to $26. Barrow and gilt prices were steady with moderate demand for moderate offerings at $27 to $35. Boars range from $5 to $13.
Pork values closed lower – down $1.48 at $64.49. Bellies, ribs, loins, and butts were lower to sharply lower. Picnics were steady. Hams closed higher. Estimated hog slaughter is 495,000 head – up 3,000 on the week and 19,000 on the year.