Market News

Feeder cattle futures continue to set record highs

It was another quiet day in cattle country with asking prices around 168.00 to 170.00 in the South and 265.00 to 270.00 in the North, but so far not even a token bid on the table. Significant trade volume will be delayed until Thursday or Friday. The kill totaled 113,000 head, 1,000 below last week, and 10,000 smaller than last year.

Boxed beef cutout values were higher on moderate to fairly good demand and light to moderate offerings. Choice boxed beef was 1.52 higher at 262.86 and select was up 1.80 at 260.83.

Live cattle contracts on the Chicago Mercantile exchange settled 25 to 107 points higher. Futures trended higher at the open and traded on a firm basis throughout the session. Contracts were supported by signs of strong late July beef demand and friendly cash expectations. August settled 1.07 higher at 159.85, and October was up .85 at 159.92.

Feeder cattle ended the session 110 to 215 points higher. For the third consecutive session feeder cattle contracts set all time record highs. Furthermore, buying was encouraged by evidence of impressive cash strength and ideas replacement supplies will stay tight through the balance of the year. August settled 1.60 higher at 223.02, and September was up 1.75 at 224.20.

Feeder cattle receipts at the Ozarks Regional Stockyards at West Plains, Missouri totaled 2486 head. Compared to last week, feeder steers traded 10.00 to 15.00 higher, while feeder heifers were 5.00 to 10.00 higher. Demand was very good on a moderate supply. Feeder steers medium and large 1 weighing 550 to 600 pounds brought 247.00 to 262.00 per hundredweight. 5 to 6 weight heifers traded from 230.00 to 247.50.

Lean hogs settled 175 to 282 points lower. Nearby contracts were especially pressured due to faltering fundamentals. Apparently pork producers continue to be aggressive sellers, recognizing decent feeding profits on one hand and the likelihood of greater country receipts over the next several months on the other. August settled 2.30 lower at 119.15 and October was down 2.37 at 103.70.

Barrows and gilts in the Iowa/Minnesota direct trade closed .92 lower at 121.12 weighted average on a carcass basis, the West was down .97 at 121.01, and the East is 1.82 lower at 118.92. Missouri direct base carcass meat price closed 1.00 to 3.00 lower from 114.00 to 115.00. In the Midwest hogs were 1.00 higher to 1.00 lower from 85.00 to 95.00 on a live basis.

The pork carcass cutout value FOB plant was down .90 at 130.23. Belly primals were over $6.00 higher but all other cuts were lower.

Faced with extremely tight ready hog supplies, many pork plants will be dark on Friday with the total kill probably reduced to around 255,000 head. It sounds like the weekly kill will fall 9% or more below 2013.

The Wednesday hog kill was estimated by USDA at 400,000 head, 5,000 more than last week, but 4,000 less than last year.