Market Commentary: Tuesday, August 9/22

Transcript

Hog futures are trading mixed at midday as the market reacts to higher corn prices. After blowing past resistance Monday afternoon, the complex is now trading back below $100.00; the further the market closes from that point, the stiffer the market's resistance grows. Cash hog trade could grow stronger by this afternoon, but it wouldn't be surprising to see the market wait until Wednesday to trade a large volume of hogs. 

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

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

For the week ending Aug 12, the Western Hog Exchange OlyWest 20 weekly price is $2.82/kg dressed, the OlyWest 21 weekly price is $2.83/kg dressed, and the BP4 price is $2.70/kg dressed. This is Kerrie Simpson reporting from the Western Hog Exchange

Weekly Regional HOG PRICE Report

 

Things to Consider….

  • The latest US Cold Storage numbers reported pork stocks at 541.0 million pounds for June, down 5.1 million pounds from May and 99.1 million pounds over year ago levels. For reference, total pork in cold storage for May was revised higher from 543.1 to 546.1 million pounds. 
  • Lessened amounts of pork in cold storage overall were offset by the seasonal rise of total hams and an increase in variety meats. 
  • Total hams rose 12.7 million pounds from May levels with the bone-in and boneless varieties up near evenly, and total hams were 8.7 million pounds over a year earlier. Historically, hams in cold storage climb from April onward to peak in September. Variety meats rose 2.2 million pounds or 10.0% from last reported, and 4.0 million pounds or +19.6% over last year. Trimmings also climbed in June, up 476 thousand pounds from May and 11.2 million pounds over last year. 
  • Spare-ribs declined 6.1 million pounds for June bringing them 39.7 million pounds over last year. Total loins fell 5.0 million pounds from last reported, with the boneless variety accounting for the overall decline, and total loins are 1.4 million over last year. Other pork slipped 2.6 million pounds for June and are 1.6 over last year, while butts fell 2.3 million pounds on the latest report bringing them 7.5 million pounds over year ago levels. Picnics edged 957 thousand pounds lower for June however are up 3.3 million pounds over last year.

  July 26, 2022



Weekly Hog Price Recap

Cash hogs varied and declined for much of the week though recorded some mid-week gains, with national cash recording particularly large daily swings while regional cash went unreported Monday. Alternatively, CME cash improved daily at good to moderate levels. Wholesale pork primal values improved on the week with bellies especially stronger, supporting US pork cutout $5.92/cwt over the previous week's average.



Market hog values improved significantly, rising generally $5-$10 per hog. The OlyW 21 rose $10.75/hog, followed by values out of Quebec which were up $8.80/hog and the OlyW 20 which rose $8.45/hog. The ML Sig 4 was up shy of $8/hog, while hog values out of Hylife and Ontario were each up around $6.50/hog and BP/TC was $4.55/hog higher. In the US, Tyson edged $0.65/hog higher while JM increased $5/hog from week ago levels. 

Weekly Hog Margins

Monitored Canadian hog margins strengthened on strongly improved hog values and were further supported by a reduction in feed costs. Canadian farrow-to-finish feed costs dropped $3.95/hog, while those in the monitored US region fell $2.30/hog from the week previous.

Hog margins out the OlyW20 surged $12.40 to $98.50/hog profits on the week, followed by those out of Ontario which strengthened $10.55 to $93.90/hog profits. Hog margins out of the ML Sig 4 improved shy of $11.90 to $77.10/hog profits and Hylife margins strengthened $10.50 to $74.25/hog profits, while OlyW 21 margins rose $14.65 to $66.45/hog profits and those out of Quebec strengthened $12.75 to $51.30/hog profits. In the US hog margins improved more moderately, with Tyson up $3 to $102.45/hog profits while JM strengthened $7.30 to $107.65/hog profits from the previous week.
 

US Regional Margins

  • Tyson: $ 102.45 USD x 1.2901 = $ 132.17 CAD
  • Morrell: $ 107.63 USD x 1.2901 = $ 138.85 CAD


Disclaimer: Commodity Professionals Inc. presents this report as a snapshot of the market using current information available at the time of the report. These findings are for informational purposes only and should not be reproduced or transmitted by any means without permission.  Commodity Professionals Inc. does not guarantee, and accepts no legal liability arising from or connected to, the accuracy, reliability, or completeness of any material contained in the publication.





Weekly Regional HOG PRICE Report

 

Things to Consider….

     A summary of the latest data for ASF as recorded by the World Organization for Animal Health (OIE) reflected an overall decline from the previous reporting period, in addition to holding below year ago levels. The number of new ASF outbreaks for the January-June period at 3.02k globally fell –42.6% from the previous period and –52.4% from year ago levels. The latest reporting period tallied 11.73k deaths, 80.5k cases, 27.5k killed or disposed of, and 113.14k susceptible globally.

     Outbreaks in Europe for the latest period recorded a total of 2.69k new outbreaks, down -37.4% from the 4.3k recorded the previous period and –51.8% under the 5.58k reported last year. The vast majority (2.49k) of the new outbreaks were recorded in the wild boar population. Many areas in the European region have targeted surveillance programs with respect to the wild boar population, which is a contributing factor in the high rate of reported outbreaks throughout the region. Notably, the European Food Safety Authority (EFSA) has recently renewed their ASF campaign for a third year, partnering with 18 different countries throughout the region to prevent, detect and report the disease. The latest reporting period tallied 4.23k deaths, 72.9k cases, 4.79k killed or disposed of, and 71.7k susceptible in the European region.

     Asia recorded 294 new outbreaks in the latest reporting period, down –57.6% from the 694 previously and –55.8% under the 665 recorded last year. The latest reporting period tallied 6.3k deaths, 6.33k cases, 20.94k killed or disposed of, and 34.17k susceptible in Asia.

     Africa recorded 29 new outbreaks in the latest reporting period, down –31% from the 42 previously and –64.6% lower than the 82 recorded last year. The latest reporting period tallied 1.14k deaths, 1.18k cases, 48 killed or disposed of, and 5.2k susceptible in the African region.  

  July 19, 2022




The Americas recorded 7 new outbreaks in domestic swine during the Jan-Jun 2022 period (1 in the Dominican Republic and 6 in Haiti), down -97% from the 232 outbreaks recorded in the previous period and –56.3% from the 16 outbreaks reported last year. ASF outbreaks were reported for the first time in 40 years in the Dominican Republic late July 2021 while the neighbouring country of Haiti recorded their first outbreak since 1984 in late August 2021. No new countries in the Americas have recorded outbreaks to-date, however the region remains on high alert to halt the spread to other areas in the region. The latest reporting period tallied 56 deaths, 88 cases, 1.72k killed or disposed of, and 2.06k susceptible in the Americas.

Weekly Hog Price Recap

Cash hogs varied during the week with regional cash up overall though down significantly Monday, while national cash declined near daily with good strength Tuesday helping to offset some weakness. Alternatively, CME cash improved daily at moderate levels. Most wholesale pork primal values rose on the week, again excluding ribs, supporting US pork cutout $5.12/cwt over the previous week's average.



Market hog values improved as much as $9/hog on the week. Hog values out of Quebec were up the most, followed by those out of Ontario which were up $8.60/hog. Hylife rose $6.85/hog, while the ML Sig 4 was up $4.50/hog. The OlyW 21 improved $7.40/hog and the OlyW 20 was up $6.40/hog, while BP/TC values climbed $1.40/hog. In the US, Tyson edged $0.35/hog higher while JM slipped $1.20/hog from week ago levels. 

Weekly Hog Margins

Monitored Canadian hog margins strengthened on improved hog values despite a moderate rise in feed costs. Canadian farrow-to-finish feed costs were up $0.55/hog, while those in the monitored US region increased $0.70/hog from the week previous.  

Hog margins out the OlyW20 improved $5.85 to $86.10/hog profits on the week, followed by those out of Ontario which strengthened $8 to $83.35/hog profits. Hog margins out of the ML Sig 4 improved shy of $4 to $65.20/hog profits and Hylife margins strengthened $6.30 to $63.70/hog profits, while OlyW 21 margins rose $6.85 to $51.75/hog profits and those out of Quebec strengthened $8.30 to $38.55/hog profits. In the US hog margins declined, with Tyson slipping $0.35 to $99.50/hog profits while JM weakened $1.90 to $100.30/hog profits from the previous week.
 

US Regional Margins

  • Tyson: $ 99.47 USD x 1.3033 = $ 129.64 Canadian Dollars
  • Morrell: $ 100.32 USD x 1.3033 = $ 130.75  Canadian Dollars




Disclaimer: Commodity Professionals Inc. presents this report as a snapshot of the market using current information available at the time of the report. These findings are for informational purposes only and should not be reproduced or transmitted by any means without permission.  Commodity Professionals Inc. does not guarantee, and accepts no legal liability arising from or connected to, the accuracy, reliability, or completeness of any material contained in the publication.