Market News

Cattle futures drop as cash weakness continues

At the Chicago Mercantile Exchange, live and feeder cattle were lower, pressured by the recent drop in cash business.  December live cattle closed $1.02 lower at $170.87 and February live cattle closed $1.65 lower at $171.82.  January feeder cattle closed $2.25 lower at $219.95 and March feeder cattle closed $1.70 lower at $222.57. 

There was another round of scattered direct cash cattle business that took place on Thursday on Thursday.  Live deals in the South were at $174, $1 lower than the bulk of this week’s business and $3 below last week’s trade.  Dressed deals in Nebraska were marked at $275, $4 below the previous week’s weighted average basis.  Look for more scattered business on Friday to finish out the week.

At the Bloomfield Livestock Feeder Cattle Auction in Iowa, the annual Thanksgiving Calf Sale, buyers were active.  However, steers and heifers sold with a lower undertone.  The USDA says demand was good for the heavy supply, which included several load lots in the offering.  Receipts were up from the most recent sale, but down on the year.  Feeder supply included 60% steers and 32% of the offering was over 600 pounds.  Medium and Large 1 feeder steers 510 to 548 pounds brought $280 to $313.50 and feeder steers 600 to 647 pounds brought $247 to $276.25.  Medium and Large 1 feeder heifers 507 to 542 pounds brought $250 to $273.50 and feeder heifers 552 to 555 pounds brought $265 to $272. 

Boxed beef closed higher on good demand for solid offerings.  Choice was $1.99 higher at $299.02 and Select was $.66 higher at $264.66.  The Choice/Select spread is $34.27. Estimated cattle slaughter was 121,000 head – down 7,000 on the year.

Lean hog futures were mostly higher on short covering, shrugging off the midday weakness in pork values and cash business.  December lean hogs closed $.20 lower at $68.77 and February lean hogs closed $1.37 higher at $71.47. 

Cash hogs closed mixed with a very light negotiated run. Supplies of market-ready hogs allow processors to move needed numbers without having to get aggressive in their procurement efforts.  Increased production (heavier hog weights, more supplies) makes it increasingly more difficult to force packers to bid up to do business.  Domestic demand continues its struggles.  And export sales declined this week, bringing into question long-term demand certainty for US pork on the global market. Barrows and gilts at the National Daily Direct closed $.54 higher with a base range of $51 to $62 and a weighted average of $58.60; the Iowa/Minnesota closed $.54 lower with a weighted average of $56.93; the Western Corn Belt closed $.39 lower with a weighted average of $56.30.  Prices at Eastern Corn Belt were not reported due to confidentiality.   

Butcher hog prices at the Midwest cash markets are steady at $55.At Illinois, slaughter sow prices were $2 lower with moderate demand for moderate to heavy offerings at $41 to $54.  Barrows and gilts were steady with moderate demand for moderate offerings at $35 to $45.  Boars ranged from $18 to $21 and $5 to $10. 

Pork values closed weak – down $.14 at $83.83. Bellies, butts, ribs, and loins were all lower.  Hams and picnics were higher and sharply higher. Estimated hog slaughter was 486,000 head – down 4,000 on the year.