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DTN Midday Livestock Comments          02/22 12:03

   Lean Hog Prices Push New Highs Early Thursday

   Livestock prices were off to a bullish start Thursday with April lean hogs 
at new seven-month highs, but cattle and feeder prices have fallen back at 

Todd Hultman
DTN Lead Analyst


   April live cattle, feeders and lean hog prices were all trading higher 
earlier Thursday with hogs still pushing to new high ground. Live cattle and 
feeder cattle, however, have fallen back from earlier highs, showing caution 
ahead of Friday's on-feed report.


   April live cattle futures are trading down $.75 at $186.9 after challenging 
their highest prices in four months earlier Thursday morning. The outlook for 
supplies of available cattle remains limited in 2024. Monday's report of 
weighted averages left off with live steers at $180.35 and dressed steers at 
$286.61 for the five-state area, leaving room for higher cash trade this week. 
No significant trade has been reported yet and bids may be cautious ahead of 
Friday's on-feed report. So far in 2024, cattle slaughter is down 5.6% from a 
year ago, partly due to fewer cattle as well as a tough stretch of cold weather 
in January. On Thursday, USDA reported last week's actual slaughter at 617,013, 
more than the 608,000 estimated earlier.

   USDA's report on Thursday morning showed choice boxed beef up $1.39 at 
$299.19, while selects were up $1.23 at $285.69 with a total load count of 69. 
Overall, the U.S. economy has been supportive of continued beef demand at the 
retail counter as boxed beef prices have rebounded since early January. This 
week's forecast is mostly dry for the central Plains with uncommonly warm 
temperatures, especially in the southern Plains.


   April feeder cattle are trading up $0.27 at $256.20 after an earlier 
challenge of their highest prices in four months. The rebound from early 
December continues to push prices higher as calves are in short supply in 2024 
and there isn't much evidence of beef cows being held back from slaughter yet, 
extending last week's loss to their lowest prices since February. The latest 
CME feeder index price of $242.66 is from Tuesday and is down $4 from a week 


   April lean hogs are trading up $2.67 at $88.65, the highest prices seen in 
over seven months and a dramatic turnaround from the experience producers 
suffered through in 2023. The good news for producers is that we continue to 
see signs of firmer demand for cash prices of both negotiated and formula hogs. 
Thursday morning's USDA quotes showed negotiated cash hogs at $73.30 and the 
swine formula base at $78.56. Since the end of 2023, negotiated prices have 
gained from a $21 deficit to formula to a $5.26 deficit Thursday, a much better 
sign of packer interest for negotiated supply and for hogs overall. We have 
also seen a consistent gain in prices of early-weaned pigs since June 2023, 
ending last week above $51.

   On Thursday, USDA said last week's actual slaughter totaled 2.634 million 
head, more than the 2.559 million head originally estimated and still an active 
pace. Thursday morning's report of pork cutout values was also encouraging for 
demand, showing the cutout at $93.07, up $2.90 on 113.69 loads and still well 
above the prices packers are paying for cash hogs. Thurday's higher cutout was 
supported by a $13.59 gain in bellies. CME's most recent lean hog index was 
projected at $77.97 for Nov. 20. Technically speaking, April hog prices are 
clearly trending higher and may eventually challenge the 2023 high of $91.60.

   Todd Hultman can be reached at Todd.Hultman@dtn.com.

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