Weekly Pork Export Sales Struggling

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Thursday June 21, 2018

LEAN HOGS:

Watch my Two Minute Drill on the hog futures market here:https://youtu.be/0GvhGmBtlvQ

Cash hog prices are called lower for today as packers so no remorse about backing off the cash at a time of year in which this is very rare. Packer margins has slipped into the red for the first time in three years. I guess the attitude is were not going to operate at a loss with production record large. In other words, the leverage, even in late June early July stands with the packer and not with the producer. The crux of the whole market is the FACT that cutout does not show some real starch. This week the cutout has been up .32, up .30 and up .17 points. Our concern about exports, which have been ripping strong so far this year (through April) have taken a turn downward. Weekly data, now for the second consecutive week, appears to verify this concern. Weekly pork sales were down 42% from the 4-week average with Mexico only in for a very small amount of pork. Exports were down 11%. Look for continued pressure as the seasonal top appears to be in place.

LIVE CATTLE:

Weekly beef export sales were awful, down 15% from the 4-week average. However, actual shipments were excellent at 18,600 MT, a marketing year high and up 11%. But why the change in sales? Theres still no cash steer trade other than the 1500 head in NE off the FCE at $1.10. Bids remain at $1.08. Futures continue to probe resistance which wont last, wont hold in our opinion. We are trading accordingly.

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