USDA Mandatory reported cattle trading was very light in the Texas panhandle on Wednesday with a few early sales steady with last week at 123.00. While packer inquiry was said to be decent in some parts of the North, actual bids continue to be few and far between at 194.00 dressed. The pending storm is causing a great deal of confusion for both buyers and sellers. To make matters worse, cattle futures imploded with triple digit losses. Asking prices are generally 125.00+on a live basis and 198.00 dressed. Cattle slaughter is estimated at 122,000 head, 8,000 more than last week and 4,000 greater than last year.
Boxed beef cutout values were steady to weak on moderate demand and offerings. Choice boxed beef was down .16 at 182.31, and select was .35 lower at 180.53.
Chicago Mercantile Exchange live cattle contracts settled 102 to 135 points lower. Sharp losses quickly developed in the live pit on Wednesday as traders focused on the lack of strong additional buyer interest in the market to sustain the gains seen late last week. Trade volume remained sluggish and allowed for the triple digit losses to continue through the remainder of the session. February settled 1.30 lower at 125.10, and April was down 1.32 at 128.22.
Feeder cattle ended the session 210 to 262 points in the red with some nearby contracts trading at or near limit levels through mid-morning. The lack of support in either the live cattle market or feeder cattle market could not be redeveloped even with the active winter storm system brewing across the central U.S. Even though feeder contracts backed away from session lows, the sharp triple digit losses held. March was 2.45 lower and settled at 140.72; April was down 2.57 at 143.60.
Feeder cattle receipts at the St. Joseph, Missouri Stockyards on Wednesday totaled 1473 head. Compared with last week’s sharply lower market, an attractive offering of feeder steers weighing over 600 lbs. sold 2l.00 to 6.00 higher while heifers traded firm to 2.00 higher. A lighter test of calves weighing less than 600 lbs. sold weak to 3.00 lower with few packages on hand to really test the market’s potential. Feeder steers medium and large 1 weighing 600 to 700 lbs. traded from 145.50 to 159.00. 6 to 7 weight heifers brought 131to 140.35.
Lean hogs were mostly 20 to 70 points higher with only April and May lower. Early stability in the lean hog futures market was upstaged by the pressure in the cattle pit. Sharply higher pork carcass cutout values on Tuesday were supportive to futures while lower cash markets in the morning report weighed on futures. Demand concerns continue to plague the market. April hogs settled .10 lower at 82.95 and May was down .37 at 90.37.
There was slow to moderate market activity with light to moderate demand in the hogs on Wednesday. Barrows and gilts in the Iowa/Minnesota direct trade closed .98 lower at 78.31 on a carcass basis, the West was down .88 at 78.19, and the East was 1.21 lower at 78.55. Missouri direct base carcass meat price closed steady to 3.00 lower from 75.00 to 76.00. Terminal hogs were steady to 1.00 lower from 50.00 to 56.00.
Pork trading was very slow, with light demand and mostly moderate offerings. Pork carcass cutout value was up .87 at 82.35.
The determination of hog buyers to cut spending even in the face of likely weather disruptions could be seen as quite impressive. Such confidence and/or brashness either indicate packers have plenty of hogs in tow or they really don’t like the pork market.
Wednesday’s hog slaughter at 421,000 head was 3,000 less than last week and 4,000 down from last year.