August hogs rose sharply higher early in the session Friday, lifting prices to their highest levels since April 21st. The hog market stayed strong for much of the session, as many traders believe that China will continue to be a strong buyer of US pork. Cash markets came in higher than expected and traders see the jump in pork bellies as a sign of a further advance in pork cut-out values ahead. However, pork cutout values released after the close Friday came in at $98.93, down 80 cents from Thursday and down from $100.07 the previous week. Loins, hams and ribs were all lower, as pork values reached their lowest price level since July 14th. Slow marketings due to heat in the Midwest helped support the cash market last week, but supply could increase this week. With less heat and declining humidity in the northern and western Corn Belt, producer marketings could increase early this week. Cash markets were strong late last week but sustaining this uptrend may be difficult without a further advance in pork product prices. The CME Lean Hog Index as of July 20th came in at 95.79, up 42 cents from the previous session and up from 95.53 the week before. The estimated hog slaughter came in at 374,000 head Friday and 2,000 head for Saturday. This brought the total for last week to 2.010 million head, down from 2.018 million head the previous week but up from 1.959 million head a year ago. Pork production for the week was 407.4 million pounds, up 3.4% from last year. For the monthly Cold Storage report, frozen pork stocks as of June 30th were pegged at 496.6 million pounds, down 9% from the previous month but up 20% from last year.
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