Market News

Cattle country at a standstill

The new showlists distributed in feedlot country on Monday look generally larger than last week, especially in Nebraska. Only Colorado appeared to be offering fewer cattle, but not by much. Feedlot country was at standstill on Tuesday afternoon. Significant trade may be delayed until late in the week. Some showlists are priced around 163.00 in the South, and 260.00 plus in the North. The cattle slaughter was estimated at 110,000 head, 1,000 below last week, and 6,000 smaller than last year.

Boxed beef cutout values were firm on the choice and sharply lower on select on light to moderate demand and moderate offerings. Choice beef was up .75 at 68.61, select was 2.65 lower at 249.56.

Chicago Mercantile Exchange live cattle contracts settled 85 to 122 points higher. After two days of aggressive selling the live pit finally caught a breather. Besides just taking profits, some speculators and commercials may simply be looking at the extreme discounts to cash and thinking enough is enough, according to John Harrington at DTN. April settled .95 higher at 156.30, June was up .85 at 146.72.

Feeder cattle ended the session 82 to 115 points higher. Feeders bounced higher along with the live pit, helped by short covering and profit taking. The premium status of the cash index was probably helpful to some degree. April settled .82 higher at 212.65, and May was up 1.82 at 206.97.

Feeder cattle receipts at the Oklahoma National Stockyards on Monday totaled 5,500 head. Compared to last week, feeder steers and heifers were mostly steady to 4.00 lower, with the exception of 650 to 750 pound steers which traded 2.00 to 3.00 higher. Steer and heifer calves were mostly steady on a light test. The quality was plain to average. Feeder steers medium and large 1 weighing 721 pounds averaged 225.96 per hundredweight. 721 pound heifers averaged 201.48.

Lean hogs settled 22 to 237 points higher. Futures may be reflecting new optimism. Triple digit gains in the summer issues were fueled by short covering and bull spreading interest. The pork carcass cutout value was solidly higher in the morning report, supported by better demand for all primals except the butt and hams. Lightly traded May was up 1.32 at 71.60, and June was 2.07 higher at 77.60.

There was slow hog market activity with light demand. Barrows and gilts in the Iowa/Minnesota direct trade closed .22 lower at 62.30 weighted average on a carcass basis, the west was down .12 at 62.31, and the National report was .66 lower at 61.08. Eastern hogs were not reported due to confidentiality. Missouri direct base carcass meat price was steady to 1.00 lower from 50.00 to 58.00. Midwest hogs on a live basis were fully steady from 39.00 to 50.00.

The pork carcass cutout value was up .75 FOB plant at 68.61. Only the belly primal was lower.

Pork product values will need to stage a strong seasonal rally just to justify the premiums that already exist on the board relative to the current lean settlement index price. In other words, the board may just yawn in the face of improving fundamentals. Bullish expectations may already be played out.

The Tuesday hog kill was estimated at 432,000 head, 1,000 more than last week, and 23,000 greater than a year ago.