By Curt Thacker Of DOW JONES NEWSWIRES KANSAS CITY (Dow Jones)--Near-term cash hog price forecasts that extend through July remain bearish and predict a continuation of deep losses for most of the nation's swine producers. Ample supplies of slaughter-ready hogs, heavier carcass weights than a year ago, and soft demand for pork continue to weigh on prices, analysts and industry participants said. Most hog producers have been losing money since September of 2007, but the losses have been most severe in the past 12 months. Record high grain prices last summer significantly raised producers' break-even levels throughout the balance of the year. The economic crisis initiated last fall and the discovery of the A/H1N1 influenza, originally called swine flu, in late April have weighed on demand and pulled prices down, deepening producers' losses. Some signs of improved demand for pork in Mexico have come from government and industry officials and indicate consumer confidence and pork purchases have returned to pre-H1N1 influenza levels. That hasn't yet resulted, however, in a resumption of exports of U.S. pork at the high levels seen prior to late April. Domestic pork shipments and demand in the full week ahead of the U.S. Independence Day holiday were expected to be more brisk than last week; instead wholesale prices have fallen and packers are planning to process fewer hogs, compared with the previous week. Wholesale pork prices Wednesday fell to more than a six-year low, dating back to April 2003, and are down about 33% from a year ago. Normally, pork prices are soft just after the Independence Day holiday and arrival of the "dog days of summer" when the hot temperatures tend to result in reduced meat consumption. The near-term outlook for pork and cash hog prices "is rather dismal," said a long-time livestock buyer in the western corn belt. A veteran commodities trader said "everyone I talk to is seeing no signs of [better] business - it's probably as bad as I have ever seen it." A Midwest-based meat broker said "it's hard to find the good news" in the current market scenario. Hot temperatures and a lack of last-minute business for the Independence holiday point to slow sales, and business after the holiday is always slower than ahead of it, he said. Bob Brown, private analyst in Edmond, Oklahoma, said, however, it is usually when no one sees any positives in the marketplace that prices are near a turnaround. That may or may not occur this time but the market trends this summer have been tracking along similar to 2005. That year, he said, pork and hog price rallied fairly sharply from late June. "The market may work through all the rough factors and move up in July and August," Brown said. There are some downside risk factors for the market though, including heavy carcass weights, which in the latest week were up 4.9 pounds from the five-year average. That is the biggest increase of this year from the five-year average. Processing margins also are deeply negative, which suggests a bearish continuation for hog prices in the near term. Brown predicts cash hog prices for July to average around $58 per hundredweight on a CME equivalent basis, or 51% to 52% lean. Rich Nelson, director of research with Allendale Inc. in McHenry, Ill., holds a cautious view as well but also predicts that a market bottom may be near. He sees the market as already undervalued after the July lean hog contract fell nearly the daily limit Wednesday and closed at 57.30 cents a pound. Nelson is looking for a bottom at around 55 cents in July futures, and if prices reach that level he considers it a buying opportunity. Nelson predicts the July contract will rally back to around 60 cents a pound before it expires mid-month. The breakeven cost for most producers is calculated at around $71 to $72 per hundredweight on a dressed basis, so losses will continue to mount, he said.
Регион | Закуп. | Изм. | Прод. | Изм. |
---|---|---|---|---|
ЦФО |
29150.00 | + 700 | 29160.00 | + 660 |
ПФО |
27950.00 | + 300 | 28050.00 | + 50 |
СКФО |
28700.00 | + 500 | 28950.00 | - 50 |
ЮФО |
28150.00 | - 200 | 28950.00 | - 50 |
СФО |
28400.00 | - 100 | 28300.00 | - 200 |
Регион | Закуп. | Изм. | Прод. | Изм. |
---|---|---|---|---|
ЦФО |
71000.00 | + 850 | 73250.00 | + 1380 |
ЮФО |
69800.00 | + 200 | 74000.00 | + 3500 |
ПФО |
71000.00 | + 1450 | 73000.00 | + 2950 |
СФО |
72000.00 | + 1800 | 75000.00 | + 4500 |
Обсуждение