Market News

Weak cash trade pushes cattle futures lower

At the Chicago Mercantile Exchange, live and feeder cattle closed mostly lower on the less than stellar cash trade, weaker wholesale values, and concerns that the slower cash business could cause a back-up in cattle country and push cattle weights higher.  October lives down $1.15 at $97.87 and December live cattle closed $1.35 lower at $102.22.  September feeder cattle closed $1.15 lower at $134.40 and October feeder cattle closed $1.10 lower at $132.32. 

A light to moderate direct cash cattle trade has been reported in parts of the South at $100 live.  That’s generally $2 to $3 lower than last week’s weighted averages.  There was a light to moderate trade that took place in the North yesterday at $165 to $167, which was generally $4 lower than last week’s weighted average basis in Nebraska.  It looks like the bulk of this week’s trade is finished, but asking prices for cattle remaining on showlists are at $105 live and $175 dressed. 

At the Oklahoma West Livestock Auction receipts are down on the week and up on the year.  Compared to last week, feeder steers and heifers were $1 to $3 lower on very limited comparable sales.  The USDA says demand was moderate and all classes of steer and heifer calves were too lightly tested for an accurate trend.  Quality was plain to average.  Feeder supply included 49 percent steers and 84 percent of the offering was over 600 pounds.  Medium and Large 1 feeder steers 703 to 742 pounds brought $137.50 to $144.25 and feeder steers 751 to 789 pounds brought $136.74 to $138.75.  Medium and Large 1 feeder heifers 650 to 689 pounds brought $130.75 to $136.50 and feeder heifers 765 to 799 pounds brought $126 to $127.50. 

Boxed beef closed lower on Choice and sharply lower on Select on light demand and heavy offerings.  Choice closed $1.23 lower at $229.42 and Select closed $4.48 lower at $204.47.  The Choice/Select spread is at $24.95.  Estimated cattle slaughter is 116,000 head – even on the week and down 4,000 on the year. 

Lean hog futures closed mostly higher as the market looks to high-level Chinese and US officials meeting for trade talks again in October.  October lean hogs closed $.82 lower at $66.30 and December lean hogs closed $.25 higher at $65.47. 

Cash hogs closed lower with fairly light negotiated purchase numbers.  The market remains hopeful that demand for US pork on the global market will see a significant increase, but that has yet to be realized.  With the heavy supplies and the continued large slaughter runs adding more pork to an already saturated market, prices are having a difficult time moving any higher.  There is some concern about the impact of Hurricane Dorian on hog processing in the Southeast – as the storm will likely create at least some disruptions.  Barrows and gilts at the Iowa/Minnesota closed $1.16 lower for a weighted average of $53.89; the Western Corn Belt closed $1.21 lower for a weighted average of $53.84; the Eastern Corn Belt was not reported due to confidentiality; and the National Daily Direct closed $1.28 lower with a base range of $49 to $57 for a weighted average of $53.42. 

Butcher hog prices at the Midwest cash markets are steady at $40.  At Illinois, slaughter sow prices were steady at $19 to $29 with moderate demand for moderate to heavy offerings.  Barrow and gilt prices were weak at $33 to $40 with light to moderate demand for moderate offerings. 

Pork values closed weak – down $.90 at $71.96.  Picnics, bellies, and ribs were all lower to sharply lower.  Butts were weak.  Hams and loins were firm.  Estimated hog slaughter is 463,000 head – down 22,000 on the week and 11,000 on the year. 

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