DTN reports beef producers will start the week hoping that last week’s major price jump was the first step in a substantial spring market rally. Poorly margined packers are reluctant to sign on in that regard unless they can find a way to keep boxes selling sharply higher. Monday was typically quiet as activity was limited to the distribution of new showlists. Initial asking prices should be around 130.00 to 132.00 in the South and 206.00 to 208.00 in the North. Mondays’ cattle slaughter at 120,000 head was 30,000 more than last week, but 4,000 less than last year.
Boxed beef cutout values were higher on light to moderate demand and light offerings. Choice beef was up 2.86 at 190.56, and select was 2.27 higher at 188.08.
Chicago Mercantile Exchange live cattle contracts settled unchanged to 45 points higher. The support came from the sharply higher boxed beef values at midday and higher cash cattle prices last week. The nearby contracts outperformed the deferred futures that were pressured as traders focused on the lack of direct beef demand seen over both the short and long term. April cattle settled .40 higher at 130.35, and June was up .45 at 125.55.
Feeder cattle ended the session 20 to 97 points higher with the pressure in the corn market offsetting the lack of support in deferred live cattle futures. March feeders settled .97 higher at 142.52, and April was up .57 at 144.72.
Feeder cattle receipts at the Oklahoma National Stockyards on Monday totaled 8100 head. Compared to two weeks ago feeder steers and heifers opened 1.00 to 3.00 lower. Steer and heifer calves under 500 lbs. were lightly tested and 5.00 to 10.00 lower; stocker cattle over 500 lbs. were steady. Feedlots remain very muddy thus hurting feed efficiency. Feeder steer calves, medium and large 1 weighing 535 to 600 lbs. brought 163.00 to 169.00. 550 to 6 weight heifer calves trade from 145.00 to 147.75.
Lean hogs settled 20 to 100 points lower, Pressure developed through the lean hog futures market early in the session. The lack of support in either the cash or pork cutout values means more of the same developing pressure is likely to hold through the early week trade. The ability to hold prices at or above $80.00 per hundredweight in the April contracts is going to be the key in limiting immediate and potentially long term pressure from overtaking the complex. April hogs settled .82 lower at 80.30, and June was down .80 at 90.57.
Barrows and gilts in the Iowa/Minnesota direct trade closed 2.22 higher the West was up 2.32 with both at 76.87 on a carcass basis; the East was down .53 at 70.11. Missouri direct base carcass meat price closed 3.00 to 4.00 lower from 70.00 to 71.00. Terminal hogs were steady to 1.00 lower from 47.00 to 54.00.
Pork trading was slow with light demand and mostly moderate offerings. Pork carcass cutout value was up .62 at 81.67.
The pork cutout seems stuck around $81 with many predicting that it will go nowhere fast over the next 30-60 days. More specifically, fresh pork items are currently priced below year-ago and have not been able to garner much strength in recent weeks. The overall softness of the economy and decline in consumer spending seem to explain tepid demand for fresh pork products.
Monday’s hog kill was estimated at 426,000 head, 21,000 greater than last week, and 6,000 more than last year.