Hogs closed higher at midweek, with August again finding support under the 50 day moving average and then closing $2 higher from Tuesday. Nearby strength supported higher closes across the rest of the market, leaving December just under $63. The hog index was off $.04 at midweek at $92.46 and projected $.07 lower for Thursday.
The pork cutout value was up $.70 at midweek to $104.69. The belly value gained $3.34 to a new record high of $211.35, which added more than $.50 to the carcass value. End users will be looking to next week’s Cold Storage report for an indication as to whether the strong June belly rally had any impact on demand.
Hog slaughter through the 1st half of the week has been running slightly behind last week, totaling 1.299 million head versus 1.314 million a week ago. Our nearby view is neutral amid record nearby basis, that looks to support August hogs on breaks. Longer term, record large 4th quarter red meat production looks to keep steady downward pressure on hog prices in the 4th quarter.
