Market News

Cattle futures stage a rally

It was quiet in cattle country on Wednesday afternoon with not much real buying interest evident with just a few bids at 157.00 in the South and 250.00 in the North according to private sources. Asking prices of 162.00 live and 255.00 dressed have probably firmed given the impressive way cattle futures closed. The kill totaled 106,000 head, 5,000 more than last week, but even with a year ago.

Boxed beef cutout values were lower on the choice and higher on select on light to moderate demand and offerings. Choice beef was down 1.03 at 248.58, and select was up 1.95 at 247.83.

Live cattle contracts on the Chicago Mercantile Exchange settled 150 to 300 points higher. After briefly trading lower in the initial rounds contracts rallied to close sharply higher and succeeded in completely erasing Tuesday’s pullback, once again underscoring the significance of the rally started late last week. The premium of the recent feedlot sales and seasonal bullishness ahead appeared to be the driving forces. April settled 300 points higher at 154.05, and June was up 2.65 at 146.30.

Feeder cattle ended the session 275 to 450 points higher. As in the case of live cattle, feeder futures landed a major bullish revival. The midweek surge seemed tied to aggressive short covering and renewed commercial buyer interest. March settled 4.50 higher at 207.22, and April was up 4.50 at 204.37.

Feeder cattle receipts at the Ozarks Regional Stockyards at West Plains, Missouri totaled just 1625 head. The last feeder sale was three weeks ago. The market was lightly tested and was steady to 4.00 lower. Demand was very good on a light supply, with ice and snow in the forecast. Today’s cow and bull sale was cancelled. Feeder steers medium and large 1 averaging 523 pounds averaged 275.66 per hundredweight. 516 pound heifers at 247.97.

Lean hogs settled 102 to 240 points higher. The gains were sparked by short covering, expectations of seasonal strength and spillover bullishness from the cattle complex. The morning carcass value was quoted over a dollar higher, supported by better demand for ribs, hams, and bellies. April was 2.40 higher at 68.00, and May was up 1.10 at 78.62.

Barrows and gilts in the Iowa/Minnesota direct trade closed .67 lower at 64.89 weighted average on a carcass basis, the West was down .53 at 64.85 and the East was not reported due to confidentiality. Missouri direct base carcass meat price was steady to 1.00 lower from 57.00 to 62.00. Midwest hogs on a live basis were steady to higher from 40.00 to 55.00.

The pork carcass cutout value was up .97 FOB plant at 69.98. All cuts were higher with the exception of the loins.

DTN says their guess is the weekly hog kill will eventually total close to 2.2 million head, roughly 6% greater than 2014.

Wednesday’s hog kill was estimated at 433,000 head, 27,000 more than last week, and 14,000 greater than last year.