Market News

Cattle futures down sharply, hogs up sharply

Futures Markets copy

Chicago Mercantile Exchange live cattle futures were sharply lower on technical selling, cash pressure and lackluster boxed beef trade. August was $2.12 lower at $110.35 and October was down $2.17 at $106.35.

Feeder cattle futures were sharply lower on technical selling, the losses in the live pit, and cash uncertainties. September was down $1.87 at $139.92 and October was $2.15 lower at $135.95.

Direct cash cattle business was essentially wrapped up at midweek. Most of the week’s trade was done Wednesday at sharply lower than the previous week’s prices. Business was generally light to moderate so packers may be short bought. DTN did report light trade at $110.50 live in Iowa and $179 dressed in Nebraska. That dressed business was steady with Thursday’s very light activity.

Boxed beef closed lower on light to moderate demand and moderate offerings. Choice was down $.88 at $199.48 and Select was $.58 lower at $193.57. The estimated cattle slaughter of 112,000 head was unchanged on the week and up 4,000 on the year.

In Iowa, heavy rainfall led to lower quality hay being baled and lower prices, limiting buyer demand. Premium small squares of alfalfa ranged from $200 to $240. Good small squares of grass sold at $130 with a big round quoted at $92. Good large rounds of oat hay brought $55. In Missouri, farmers cut hay all week despite showers and rain chances. The USDA says the recent heavy hay cutting activity may be producers trying to get as much done as possible ahead of harvest. The supply was moderate, demand was light, and prices were steady to weak. Supreme squares of alfalfa ranged from $180 to $200. Good quality mixed grass hay sold at $75 to $100. Fair to good quality Bromegrass brought $50 to $80. For Nebraska, all forages sold steady, compared to the previous week. The USDA says demand increased because of more attractive prices. Rain across the state was spotty, with trace amounts in some areas and up to 3 inches in others. There are reports that silage cutting is going to start soon and some contacts have been made for fall delivery of cornstalk bales to feedlots. In Northeast/Central Nebraska, premium large squares of alfalfa ranged from $160 to $160 with premium large round bales at $80. Premium large rounds of grass hay bought $80. In the Platte Valley, good large round bales of alfalfa were reported at $70 to $75 with some delivered at $85. Ground and delivered alfalfa sold at $90 to $115.

Lean hog futures were sharply higher on most contracts’ discount to cash and oversold signals. The cash and wholesale fundamentals remain bearish with ample market ready numbers and plenty of pork. October was up $2.62 at $61.32 and December was $2.15 at $56.62.

Cash hog markets were steady to lower. Buyers held plenty of leverage over the market with lower bids leading to fairly good movement as the week went on. The slaughter rate’s been very high during August. Saturday’s kill is expected to be around 112,000 head, which is down on the week, but still pretty big for this time of year. Market ready numbers are ample and processing margins are good.

Iowa/Southern Minnesota barrows and gilts closed $.95 lower with a weighted average of $61.03, the Western Cornbelt was down $.91 at $60.99, and National direct trade was $1.00 lower at $60.68. Butcher hogs at the Midwest cash markets were steady at $37 to $50. Missouri direct butchers were steady to $1 lower at $54 to $59 on light to moderate supply and demand. Missouri sows were steady at $40 to $51. Illinois direct sows were mostly steady at $41 to $54 with moderate demand for light offerings. Boars ranged from $12 to $25.

The pork cutout closed $.14 lower at $76.39. Loins, picnics, ribs, and bellies were lower, butts and hams were higher. The estimated hog slaughter was 428,000 head, steady with a week ago and up 24,000 from a year ago.

The USDA reports delivered feeder pig receipts for the week at 83,038 head, down on the week and the year. Compared to the week before, early weaned pigs were $1 lower with the composite formula range at $20 to $48 for a weighted average of $35.22. The cash range was $13 to $26 for an average of $19.52. All feeder pigs were $2 higher with a composite cash range of $26 to $33 and weighted average of $29.71.

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