The hog market pushed sharply lower on the session Friday for the second day in a row, with prices following other commodity markets lower and many traders continuing to see a high premium of futures over cash prices as a limiting force. The hog market closed higher on the week, however, with nearby futures at their highest level since August 10th. The continued move higher in pork cut-out values has been seen as projecting higher export levels, which is widely thought to lead to a higher cash hog trade ahead. Cash hogs were expected to trade steady late last week, but a rise in pork values led by a jump in loin prices helped support packer margins and gave packers an incentive to bid higher with cash up $1.00 at some locations. Pork cut-out moved $1.61 higher on Thursday and up $1.35 Friday to $85.14. As reported late Thursday, monthly pork exports for November came in at 406.15 million pounds. That was up 6.7% from the previous year, and was the highest monthly total since the spring of 2008 and represented 19.8% of total production. Pork production for the week at 442 million pounds was down 2.5% from last week, and about unchanged from last year. The CME Lean Hog Index as of January 12 came in at 73.56, up 30 cents from the previous session and up from 72.64 the week before. The estimated hog slaughter came in at 408,000 head Friday and 120,000 head for Saturday. This brought the total for last week to 2.135 million head, down from 2.189 million head the previous week and down from 2.174 million head a year ago. Pork cutout values released after the close Friday came in at $85.14, up $1.35 from Thursday and up from $78.55 the previous week. South Korea has culled near 2 million pigs and has reduced the pig and cattle population by about 15% so far, in their attempt to stop foot and mouth disease from spreading. Traders see this as a reason to suspect higher meat exports ahead.
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