February hogs closed moderately lower on the session yesterday after an early rally to a 4-session high ran out of momentum. Higher cash markets Tuesday and again yesterday were a supportive factor but the premium of futures to cash prices may have helped to limit the advance. With sluggish near-term pork cut-out value trading and excellent weight-gain weather during November and December, the market may see a little higher than expected production over the near-term. However, a shift towards lower production levels into mid-February could still provide strong seasonal support for the cash market although record weights could spark some short-term selling. The CME Lean Hog Index as of December 30th came in at 81.39, down 15 cents from the previous session and down from 83.09 the week before. The estimated hog slaughter came in at 428,000 head yesterday. This brings the total for the week so far to 866,000 head, down from 868,000 head last week at this time and down from 1.252 million head a year ago. Pork cutout values released after the close yesterday, came in at $84.71, down 90 cents from Tuesday and down from $86.29 the previous week. This is the lowest trade for pork values since January 13th of last year. Weekly average weights for Iowa-Southern Minnesota as of December 31st came in at a new all-time record high (since 1988) at 277.9 pounds, up from 275.7 pounds the previous week and up from 274.7 pounds last year.
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