US - We hear this term (Rewarding the Market), but having a marketing plan means we need to pull the trigger, writes Allan Bentley, Sales & Service, Genesus.
At the time of my last market report cull sows were 10-15 cents a pound, I advised holding off on those cull sales as long as possible and cull sows are now at 35-40 cents. I think that market will continue higher but we need to reward the market and sell those conditioned sows, as they are the most valuable. As for lighter and thinner sows, I would hold them, if at all possible.
The June and July futures at the time of my last report were around 71 cents. That market has improved to almost $81.00. Depending on the basis that should bring back about $62.00/ live, which I believe that is a great place to start selling futures or forward contracting hogs.
Looking forward, the numbers say we will see 3% more chicken and 4% more beef, as for pork, I think we will keep the supply steady with last year.
There is no sow buildings going up anywhere that I know, a lot of talk, but a lot of foot dragging by lenders. The one market mover that I could see pushing cash hogs higher around June is the reports of a semen extender that has been suspected to cause born alive numbers to drop by 2-3 pigs. I hear most boar studs quit using it by Oct 1, 2015. Depending on the market share this extender had, it could cause a drop in numbers briefly this summer.
As for the 4th quarter futures, just like a 16 year old coming home at 2 am, I would not reward that behavior. It has gained about $2.00 but in comparison to June, I believe it has more potential. That is what my Dad always told me when he compared me to my sister.
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