Market Commentary: Friday, February 7/25

Transcript

Hog futures are trading higher in most months. Seeming unconcerned about the market's resistance, the hog complex continues to rally into today's noon hour. April lean hogs are up $0.62 at $92.37, passing the resistance level. It is extremely helpful that pork cutout values are up over $1.00 this morning as demand continues to be one of the biggest driving components for the market at this time.

Cash hog prices on the National morning report are lower, the morning cutout value is higher.

The Canadian Dollar is trading higher against the US dollar at midday.

For the week ending Feb 7, the Western Hog Exchange OlyWest 20 weekly price is $2.17/kg dressed, the OlyWest 21 weekly price is $2.29/kg dressed, and the BP4 price is $2.11/kg dressed. This is Kerrie Simpson reporting from the Western Hog Exchange

Weekly Regional HOG PRICE Report

 

Weekly Regional HOG PRICE Report

Things to Consider…

       USDA isowean and feeder pig prices continue at historically strong levels, and are generally higher than other strong starts recorded in 2014, 2022 & 2023. 

       Isowean cash averaged $83.33/head for January 2025, -0.7% under the high of 2014 at $83.96 but up +20.9% over Jan’22 ($68.95) and +25.0% over Jan’23 ($66.69). 

       Feeder cash averaged $102.82/head for January 2025, up +6.5% over Jan’14 at $96.57, +13.3% over Jan’22 ($90.75) and +18.6% from Jan’23 ($86.68).

       It’s worth noting that January 2014 & 2022 were based off a notably lower number of receipts, while 2023 was generally near the average, and 2025 is among the highest amount of reported receipts (only under Jan’24).

       Receipts for isowean and feeder pig cash included in the weighted average price calculation have increased overall (blue line in the third graph), surging from late-2022 to high levels late-2023 and holding there until late-2024. In more recent weeks, the number of cash receipts being included has slid however still holds above the historical weekly average. The 10-year average was near 53,000 head per week (2015-2024), while receipts for the more recent period of 2023-2024 averaged 76,000 head. 

       Formula receipts, of which are exceedingly for isoweans, have decreased over time (black line on the third graph). From 2015, the 10-year average was around 42,000 head. Receipts began falling throughout the first-half of 2022 to hold lower counts until mid-2023 before declining again until late-2023. A surge following this low was recorded into early 2024, however has since retreated to hold near a genearlly stable level of around 33,000 head. 

For reference, according to the latest hog inventory numbers for the previous quarter, the annual pig crop for 2024 is the third highest recorded historically (behind 2019 & 2020 at 139.4 & 140.2 million, respectively).

  February 4, 2025

 
   
 
 
 

Weekly Hog Price Recap

US cash hogs improved throughout much of the week, with national cash averaging $1.89/cwt higher while regional cash averaged $2.85/cwt above the previous week. CME cash improved daily with stronger rises recorded mid-to-late week and averaged $0.95/cwt above last week's average. Wholesale pork primals were primarily higher, excluding generally modest declines in picnics and hams, with US pork cutout up +2.2% or $2.05 higher to $93.40 US/cwt from the week previous.



Weekly Canadian hog prices generally improved $1-$5 per hog from a week earlier. Quebec hogs jumped $5/hog, followed by Hylife which rose $4.55/hog and hogs out of Ontario which improved $4.30/hog. The ML Sig 4 was up $2.55/hog, while markets derived from lagged base pricing such as OlyW pricing and BP4/TC4 were each up around $1.20/hog. In the US, Tyson hogs jumped $6.35/hog while JM hogs rose $5.90/hog from the week previous.

Weekly Hog Margins

Monitored hog margins strengthened on improved hog values and further supported by a moderate decline in feed costs. Farrow-to-finish feed costs on either side of the CAN/US border were down $1/hog from a week earlier.

Ontario hog margins strengthened $5.25 to $29.45/hog profits, followed by margins out of Hylife which rose $5.50 to $29.15/hog profits. ML Sig 4 margins were up $3.50 to $28/hog profits out of Brandon and $23.65/hog profits out of Lethbridge. OlyW 20 margins improved $2.10 to $26/hog profits while margins out of Quebec strengthened $6 to $23.50/hog profits and the OlyW 21 R2 was up $2.15 to $13.85/hog profits. In the US, Tyson hog margins strengthened $7.35 to $37.80/hog profits while JM margins rose $6.90 to $32.85/hog profits.
 

US Regional Margins

  • Tyson: $ 37.78 USD X 1.4422 = $ 54.49 in Canadian Dollars
  • Morrell: $ 32.83 USD X 1.4422 = $ 47.35 in Canadian Dollars




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