November 13, 2008
The Midwest direct hog markets on Wednesday (November 12, 2008) are expected to trade steady to weaker amid light demand since most plants reportedly have the bulk of their needs already filled for this week.
Only a few plants are still buying additional loads for delivery this week. With the thin buying interest overall, the plants should be able to purchase the hogs they need at flat to lower prices. Livestock dealers and market managers said there are always a few loads available from producers who sell on a spot market or deliver hogs to the terminals.
Expectations for Saturday's (November 15, 2008) slaughter are now from 145,000 to 155,000 head, up a bit from Tuesday (November 11, 2008) after a packer added another plant to the weekend schedule.
The pork cutout was up $1.16 per hundredweight on Tuesday (November 11, 2008). Hams showed the biggest gains but that was done on just five loads for the category which analysts and brokers said was a thin test, so there is uncertainty as to whether the gains in prices will hold.
Some livestock dealers and market managers predict that prices could remain in a flat to weaker trend through the balance of this month since demand for hogs could be slow until after the Thanksgiving holiday, which will be observed Nov. 27. Seasonally large supplies and the holiday will keep most packers full until early December, they said.
The Dow Jones Newswires packer margin index for Tuesday was plus US$10.98 per head compared with US$7.62 the previous day.
The terminal markets are called mostly steady to weak with tops expected from US$32 to US$36 on a live basis.
The projected Chicago Mercantile Exchange two-day lean hog index for Monday was US53.74 cents a pound, down US0.72 cents from the previous day.