Market News

Cattle futures are higher ahead of cash business

At the Chicago Mercantile Exchange, live cattle ended the day higher on oversold signals and optimism ahead of the week’s cash trade.  Feeder cattle were higher on the same factors with additional support from the day’s lower move in corn.  June live cattle closed $2.20 higher at $96.32 and August live cattle closed $1.47 higher at $97.80.  August feeder cattle closed $1.17 higher at $134.25 and September feeder cattle closed $1.02 higher at $135.55. 

Direct cash cattle trade is still pretty quiet.  Bids and asking prices have been slow to surface.  A very light trade was reported in parts of Iowa at $165 dressed, but that’s not enough to establish an accurate trade. Showlists this week are somewhat lower in Kansas, and lower in Texas, and Nebraska/Colorado.  It looks like significant trade volume could wait until a little later in the week before developing.  Wednesday’s Fed Cattle Exchange has an offering of 1,447 head. 

At the Callaway Livestock Center in Missouri, compared to last week 400 to 500-pound steer calves were mostly steady, 500 to 650-pounds were steady to $3 lower.  Heavier weight steers were steady to $2 lower.  Feeder heifers 400 to 450-pounds were steady to $4 higher, 450 to 500-pound heifers were steady, 500 to 600-pound heifers were steady to $4 lower, heavier weight heifers were $3 to $4 lower.  The USDA says demand was moderate to good on moderate to heavy offerings.  There were a lot of good yearling cattle in the offering.  Receipts were down on the week, but up on the year.  Feeder supply included 57 percent steers and 54 percent of the offering was over 600 pounds.  Medium and Large 1 feeder steers 703 to 739 pounds brought $139 to $142.25 and feeder steers 876 to 893 pounds brought $124 to $124.25.  Medium and Large 1 feeder heifers 656 to 698 pounds brought $128.25 to $137.25. 

Boxed beef closed lower to sharply lower on light demand for heavy offerings.  Choice closed $7.58 lower at $247 and Select closed $3.17 lower at $227.95.  The Choice/Select spread is $19.05. Estimated cattle slaughter is 117,000 head – up 1,000 on the week, but still down 5,000 on the year. 

Lean hog futures closed mixed on spread trade.  Nearby contracts were pressured by supply and demand concerns while deferred contracts were higher, optimistic about long-term demand potential.  June lean hogs closed $.50 lower at 48.07 and July lean hogs closed $1 lower at $52.97. 

Cash hogs closed steady with moderate negotiated purchases.  The processing sector has been recovering much better than analysts would have predicted just a month ago.  The USDA reports that pork facilities are running around 95 percent of year-ago levels. As slaughter totals continue to rise, that helps to alleviate some of the pressures on producers as hogs aren’t backing up in the supply chain, but they’re still trying to work through the backlog that had developed.  But with heavy supplies of market-ready barrows and gilts that’s not an easy task.  The industry remains hopeful demand for US pork stays strong both domestically and on the global market.  That will be key to recovery for this part of the ag economy.  Barrows and gilts at the National Daily Direct are $.05 with a base range of $27 to $32 for a weighted average of $30.76; the Iowa/Minnesota had no comparison but a weighted average of $31.10; the Western Corn Belt had no comparison for a weighted average of $31.10.  The Eastern Corn Belt was not reported due to confidentiality. 

Butcher hog prices at the Midwest cash markets are steady at $20. At Illinois, slaughter sow prices were steady with moderate demand for moderate to heavy offerings at $7 to $20.  Barrow and gilt prices were weaker with light demand for heavy offerings at $10 to $20.  Boars ranged from $1 to $5. 

Pork values closed lower – down $1.62 at $69.26.  Loins, picnics, and bellies were lower to sharply lower.  Hams closed steady.  Butts and ribs were firm to sharply higher.  Estimated hog slaughter is 450,000 head – up 33,000 on the week, but still down 22,000 on the year.