Market Closes - December 28, 2012

Posted on Dec 28, 2012
Two negative news items this afternoon: 1) Quarterly Hogs & Pigs report is bearish, and 2) a late-afternoon meeting between President and Congressional leaders ended with no apparent results leading to additional sharp losses in stock index futures after the NYSE had closed. Political reporters will be earning overtime this weekend.

CBOT futures managed small gains today without any significant market news. Funds were reported to be net buyers of futures today. The best news came from the very strong soybean oil futures pit, along with news that China purchased US soybeans this week (after major cancellations last week). The CBOT closed trading before the latest negative news came out of Washington DC, so Sunday night, CBOT futures may react to the situation that’s public at that time.

Live Cattle and Feeder futures both managed higher closes despite the economic uncertainty tied to the “fiscal cliff” issue and the $1.27 cash cattle market that’s below December futures which end trading on Monday. The $4+ premium of February to December is a positive indicator. In boxed beef, Choice DN 0.77 at 193.49; Select UP 0.80 at 180.29; the CHOICE-SELECT SPREAD continues to narrow ($13.20/cwt).

Lean Hog futures closed lower for the third straight day ahead of this afternoon’s Hog and Pigs report which turned out to be bearish. Both breeding inventory and market hog inventory were nearly unchanged from a year earlier compared to trade expectations of measurable declines. The USDA report summary is printed below

Corn Mar +2.5 694; Jly +3 695; Dec +4 600

Bean Jan +5 1424; Mar +4 1418; Jly +6 1407; Nov +8 1310   Meal Jan -2 428; Oct +.4 373   Oil +65 4894

Wheat Mar +6.5 779; Jly +5 795   KC +3 826; MGE +3 868

LC Dec +55 12940; Apr +35 13722; Oct +22 13470 FC Jan +75 15202; Apr +97 15680; Aug +127 16297

LH Feb -65 8637; Apr -82 9012; Jly -67 9902

Milk Jan -2 1810; Feb +18 1854

Oats -4 349

Rice -4 1495

US$ +.05%

Dow -158 12938 SP -16 1402 (futures lower after the close) NAS -26 2960 Tran -45 5220   VIX +3.25 22.72  +16.7% Soared in final minutes.

WTI -20 9027 Brent -38 11042 Gas -1.5 280.5 NG -4 335.5 HO -2 305.5 Eth -1 219.5

Gold -7 1657 Slvr -20 3004

2-yr -.003 0.258% 5-yr -.028 0.712% 10yr -.042 1.700% 30yr -.052 2.867% 

U.S. Hog Inventory Down Slightly United States inventory of all hogs and pigs on December 1, 2012 was 66.3 million head. This was down slightly from December 1, 2011, and down 2 percent from September 1, 2012. 

Breeding inventory, at 5.82 million head, was up slightly from last year, and up slightly from the previous quarter.

Market hog inventory, at 60.5 million head, was down slightly from last year, and down 2 percent from last quarter.

The September-November 2012 pig crop, at 29.4 million head, was up slightly from 2011.  Sows farrowing during this period totaled 2.90 million head, down 1 percent from 2011. The sows farrowed during this quarter represented 50percent of the breeding herd. The average pigs saved per litter was a record high 10.15 for the September-November period, compared to 10.02 last year.   Pigs saved per litter by size of operation ranged from 7.60 for operationswith 1-99 hogs and pigs to 10.20 for operations with more than 5,000 hogs and pigs.

 United States hog producers intend to have 2.86 million sows farrow during the December 2012-February 2013 quarter, up slightly from the actual farrowings during the same period in 2012, and up 1 percent from 2011.   Intended farrowings for March-May 2013, at 2.93 million sows, are down 2 percent from 2012, but up slightly from 2011.

 The total number of hogs under contract owned by operations with over 5,000 head, but raised by contractees, accounted for 47 percent of the total United States hog inventory, up from 45 percent last year.

 See full USDA report at:  http://usda.mannlib.cornell.edu/MannUsda/viewDocumentInfo.do?documentID=1086

Tagged Post Topics Include: Economics, Market updates