Cattle on feed report appears bullish

The cash cattle market was at a standstill on Friday afternoon with business essentially done for the week except for a few sales in the North at 124.00 live. Limited trade volume points to more cattle carried over into Monday. On the other hand limited procurement by packers could mean they are quite close to the knife. The weekly cattle kill totaled 625,000 head 10,000 more than last week 24,000 greater than 2012.

Boxed beef cutout values were weak on light demand and light to moderate offerings. Choice beef was down .57 at 187.44, and select was .33 lower at 181.86.

The January 1 on feed report looks friendly according to DTN analysts, with all three categories exceeding the bullish suggestions of private guesses. On feed totals were down 6%, placements in December off 1%, and marketing’s in December 2% lower.

Chicago Mercantile Exchange live cattle contracts closed 42 points higher to 70 lower after exhibiting moderate to strong gains through the morning. Traders focused on the lack of follow through support that developed near midsession as well as uncertainty about being able to stabilize beef cutout values through the end of the month. February settled .42 higher at 126.30, and April was up .40 at 130.75.

Feeder cattle ended the session 12 points higher to 30 lower despite the weakness in corn futures. January settled .10 higher at 144.70, and March was unchanged at 147.95.

Feeder cattle receipts at Missouri auctions this week totaled 33.388 head. Compared to last week, feeder steers and heifers sold steady to 3.00 lower, with the exception of several mid weight calves, mostly steers which were high quality and weaned with at least one round of shots, they sold steady to 2.00 higher. This week’s supply was moderate. Feeder steers, 1499 head medium and large 1 averaging 629 lbs. brought 156.85 per hundredweight. 909 heifers with an average weight of 623 traded at 140.85.

Lean hogs ended the session 07 to 75 points lower. The pressure in cash hog values and the inability of outside markets to hang onto early buyer support, created additional softness through the nearby contracts. February settled .22 lower at 86.82, and the April was down .75 at 88.92.

There was slow market activity with light demand in the hog market on Friday. Barrows and gilts in the Iowa/Minnesota direct trade closed 1.88 lower weighted average on a carcass basis at 85.78, the West was 1.74 lower at 85.64, and the East was down 1.25 at 82.95. Missouri direct base carcass meat price was steady from 78.00 to 79.00. Terminal barrows and gilts closed fully steady from 56.00 to 58.00 live.

Pork trading was slow, with light demand and mostly moderate offerings. Pork carcass cutout value was up .41 at 85.11.

Despite steady/firm packer spending for much of this week, day-to-day negotiated hog receipts seem stuck in slow gear. Until pork processors can get ahead in terms of live inventory needs the cash trade will continue to work generally higher.

The weekly hog slaughter was estimated at 2,159,000 head, 63,000 less than last week, but 5,000 greater than last year.

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