Futures to React to Hogs and Pigs

Thursday futures trading pushed the July and August contracts triple digits higher, with weakness in the deferred months. The back month contracts closed off their lows with 2 to 15 cent losses. USDA’s National Average Base Hog price was 30 cents weaker on Thursday afternoon at $94.21. The 6/27 CME Lean Hog Index was $92.96, up by another 44 cents. 

USDA’s Hogs & Pigs report released after market close on Thursday put the June 1 All hogs count at 72.394 million head. That was a 0.11% increase from last year’s inventory. The analyst estimates going in were to see a 0.7% reduction on average. Of that, NASS counted 66.249m market hogs (+0.16%) and 6.164m breeding hogs (-0.36%). There were 2.896m farrowing sows during March-May which was a larger than expected contraction from ’22 at 2.4%. Farrowing intentions for June-August is 2.953m head compared to 3.092m head last year and the 2.6% reduction expected. USDA also revised last year’s farrowings lower. 

The weekly Export Sales data showed 26,698 MT of pork was sold during the week that ended 6/22. Mexico was the top buyer with over half of the volume sold. 

Pork cutout futures were also mixed, with 87 cent gains for July and a 47c loss for the Dec contract. The National Pork Carcass Cutout Value was $3.82 higher in the PM report to $102.90 cwt. Bellies were $18.85 higher to their highest quotes since February. USDA estimates the weekly hog slaughter at 1.812m head, down 29k head from last week and 27k head from the same week last year. 

Jul 23 Hogs  closed at $95.450, up $1.175,

Aug 23 Hogs  closed at $92.325, up $1.225

Jul 23 Pork Cutout  closed at $100.800, up $1.175,