Lean Hogs Still Have Major Discount to Cash

On Tuesday, April hogs were down $1.75, but deferred contracts had some triple digit gains. The CME Lean Hog Index for March 27th was $65.56, down 90 cents. That is still a substantial premium to futures. The National Average Base Hog price was down by 82 cents to $53.63. The WCB Average Base Hog was $55.33, which was a $3.03 premium to ECB Average Base Hogs. The Pork Carcass Cutout Value was down $5.67 to $65.04 yesterday afternoon. All primal cuts were lower, and butts were down the most. Belly cuts were quoted at $37.83 cwt.! The US ag attaché in Beijing noted that Chinese importers have applied for, received, and are using tariff exemptions for U.S. pork. The exemptions were on section 301 tariffs, while section 232 (25% beginning April 2018) are still in effect. US pork is very competitive due to elevated Chinese internal prices. USDA estimated Tuesday’s FI hog slaughter at 493,000 head. WTD slaughter was estimated 9,000 head below last week’s pace.

--- provided by Brugler Marketing & Management

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