Pig outlook—June 20: Lean hog futures bears may be exhausted

Jim Wyckoff reports on pig news from around the global
calendar icon 21 June 2024
clock icon 3 minute read

The lean hog futures market has made a solid rebound from the June spike low, which begins to suggest the bears have run out of gas and that a market bottom is in place. However, the bulls have more work to do to suggest a price uptrend can be started and/or sustained. The CME lean hog index is down 71 cents to $90.73 as of June 14, the biggest daily decline since April 9. Retailers have been raising retail pork prices which is crimping consumer demand. Hog supplies will be at their lowest of the year during the next few weeks, which may offer some hog/pork market support.

China may take provisional anti-dumping steps against EU pork imports

China may impose provisional anti-dumping measures on pork imports from the European Union as part of a year-long probe that began on June 17, its commerce ministry said. “If, after a preliminary investigation, it is determined that dumping has been established and has caused injury to domestic industry, provisional anti-dumping measures may be taken,” a commerce ministry spokesperson said, without giving specific details.

China’s pork imports continue to decline

China imported 80,000 MT of pork in May, down 11.1% from the previous month and 41.1% less than year-ago. Through the first five months of this year, China imported 430,000 MT of pork, down 47.1% from the same period last year.

USDA Livestock, Dairy, and Poultry Outlook: June 2024

Pork/Hogs: Second-quarter pork production was adjusted upward by 40 million pounds to 6.730 billion pounds on expectations of higher average dressed weights and higher than-expected ready-to[1]slaughter hogs from the December–February pig crop. Second-quarter hog prices were lowered $2 per hundredweight (cwt) to $66 per cwt, about 16 percent below prices a year ago. Third-quarter hog prices were lowered $3 to $68 per cwt. U.S. pork exports for 2024 were increased 100 million pounds to 7.362 billion pounds, about 8 percent higher than shipments in 2023, as Europe’s share in the world's pork export markets continues to diminish.

HSUS criticizes Vilsack for opposing California’s Proposition 12 in farm bill

The Humane Society of the U.S. (HSUS) criticized USDA Secretary Tom Vilsack for supporting the pork industry's efforts to override California's Proposition 12. This controversy has extended to the farm bill, a five-year plan for agricultural operations. The House Ag Committee recently passed a farm bill limiting states' and localities' ability to impose livestock production conditions outside their borders, a response to Prop 12, which bans the sale of pork not raised under specific animal welfare standards and prohibits gestation crates.

HSUS accused Vilsack of promoting zero-welfare pork producers and using the farm bill to dismantle Prop 12 and similar laws. The group urged the White House to intervene, stating Vilsack's actions could harm the administration's animal welfare policies. They argued that Vilsack is undermining the interests of thousands of farmers and major public health associations opposing the cruel confinement of farm animals.

The next week’s likely high-low price trading ranges:

August lean hog futures--$86.675 to 95.00 and with a sideways-higher bias

July soybean meal futures--$354.70 to $375.00, and with a sideways bias

July corn futures--$4.38 1/4 to $4.60 1/2 and a sideways-lower bias

Latest analytical daily charts lean hog, soybean meal and corn futures

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