Market News

Cash cattle and futures both lower

Scattered dressed sales on the cattle are evident in Nebraska marked at 196.00 for spot delivery, roughly $4.00 lower than last week. DTN reported having heard of a few deals at even lower money tied to mid and late May delivery. Significant trade volume may be delayed until Friday. While feedlot managers started the week pricing cattle higher, psychology is clearly being stressed by sharply lower futures, and struggling wholesale beef demand. The kill totaled 112,000 head, 1,000 more than last week, but 4,000 below a year ago.

Boxed beef cutout values were sharply lower on light to moderate demand and moderate to heavy offerings. Choice beef was down 2.31 at 212.50, and select was 2.50 lower at 203.09.

Chicago Mercantile Exchange live cattle contracts suffered triple digit losses of 155 to 300 points on Thursday. Aggressive long liquidation was back in play after several rounds of profit taking seen earlier in the week.

Feeder cattle ended 77 to 450 points lower. The market was clobbered by faltering live targets, stronger action in the corn trade, and commercial selling.

Feeder cattle receipts at the Springfield Missouri Livestock Marketing Center totaled 2006 head on Wednesday. Compared to last week, steer and heifer calves were 2.00 to 5.00 lower, yearlings were not well tested, but the undertone was lower. Holsteins compared to two weeks ago, under 600 pounds were 10.00 to 20.00 lower, 600 pounds to 800 were 10.00 lower, over 800 steady. Demand was moderate to light on a moderate supply. Feeder steers medium and large 1 averaging 518 pounds brought 167.60 per hundredweight. 524 pound heifers averaged 148.39.

The Fort Atkinson, Iowa Hay Auction had a much smaller run on Wednesday with corn being planted instead of moving hay. Prices were steady to a little stronger depending on the quality. Bedding was steady with last week. Utility hay brought $65.00 per ton, fair from 50.00 to 90-.00, and good hay ranged from 89.00 to 130.00 per ton.

Lean hogs settled 7 to 130 points higher with the May through August contracts up the most. The market was supported by signs of greater packer spending in the country and outstanding weekly export sales.

Barrows and gilts in the Iowa/Minnesota direct trade closed .35 higher at 69.78 weighted average carcass basis, the West was up .56 at 68.22, and the national the market was up .18 at 68.41. Missouri direct base carcass meat price was steady to 2.00 higher from 55.00 to 63.00. Midwest hogs on a live basis were fully steady from 40.00 to 50.00.

The pork carcass cutout value ended the day .05 lower at 81.97 FOB plant.

June hog futures even in the $79 area are trading in the lower 4%-5% of trading values over the past five years. If bullish momentum shifts into higher gear thanks to surprisingly friendly fundamentals, prices could conceivably run higher for a long time.

Thursday’s hog slaughter was estimated at 401,000 head, 31,000 less than last week, and down 23,000 from last year.