February hogs closed sharply lower on the session yesterday and down near the lowest price levels since December 22nd. The market pushed lower early led by news of record high slaughter weights last week and a setback in pork cut-out late Wednesday which are down near a 1-year low. Short-term cash fundamentals still appear for many traders to be a bit sloppy as the market is in the process of absorbing a little higher than expected production due to record high weights as they were hoping to see producers clean up any backlog of hogs in the country. Near ideal winter weather in the northern Midwest has helped to push average weight higher. The CME Lean Hog Index as of January 3rd came in at 81.50, up 11 cents from the previous session but down from 82.58 the week before. The estimated hog slaughter came in at 428,000 head yesterday. This brings the total for the week so far to 1.294 million head, down from 1.299 million head last week at this time and down from 1.669 million head a year ago. Pork cutout values released after the close yesterday came in at $84.33, down 38 cents from Wednesday and down from $86.02 the previous week and this is the lowest pork trade since January 13th of 2011.
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