The extreme hot weather could provide a positive spin to the hog market from the standpoint of curtailing marketings and causing animal stress, but it also may be having an effect on demand, and this may help limit the market over the near term. A soaring US dollar could also pressure hog prices, as it could limit the pork export outlook. Pork cutout values were down sharply on Tuesday, which suggests packer demand for hogs will be lower this week. Pork cutout values, released after the close Tuesday, came in at $91.56, down $2.29 from Monday and down from $99.46 the previous week. This was the lowest pork cutout since June 13th. The stronger slaughter pace on Monday and Tuesday could be indicating better packer demand, but is could also be that the packers boosted their activity in anticipation of plant closings for the holiday. Tuesday's estimated hog slaughter came in at 423,000 head. This brings the total for the week so far to 843,000 head, up from 788,000 last week at this time. The CME Lean Hog Index as of June 28 came in at 103.08, up 29 cents from the previous session and up from 98.98 the week before. Traders see hot weather and high humidity as reasons to expect lower Midwest marketings for the remainder of this week, which could help the bull camp. Traditionally hot weather brings on bacon demand, and that may still occur now that the July 4th holiday is behind us. The CME Lean Hog Index as of June 29 came in at 101.76, down 35 cents from the previous session but up from 102.01 the week before. With nearly 25% of US production on the export market, exports will still be a major factor for prices ahead. The less fearful outlook for the global economy late last week was a positive, and a rate cut in China announced this morning lends some additional strength, but the stronger US dollar today is negative.
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