Market News

Weaker cash business continues to pressure cattle futures

At the Chicago Mercantile Exchange, live and feeder cattle were pressured by the recent slide in direct business and demand uncertainties linked to the economy.  June live cattle closed $1.25 lower at $161.65 and August lives closed $1.40 lower at $159.55.  August feeders closed $2.65 lower at $223.52 and September feeders closed $2.52 lower at $226.75. 

There was another light round of direct cash cattle business on Wednesday.  Deals in the North were at $281, fully steady with Tuesday’s business, and $3 below the prior week’s weighted average basis.  Also, this week, live deals in the South were marked at $172, $1 lower than the prior week’s weighted averages.  While the South could very well have wrapped up its business for the week, some cleanup trade could take place before the end of the day Friday.  Asking prices for what’s left on showlists are firm around $174 live in the South and $284 dressed in the North.

At the Kingsville Livestock Auction in Missouri, all steers and heifers were steady, and all weights sold on an active market with good to very good demand.  However, some of the lighter-weight cattle under 500 pounds didn’t quite hit the recent highs.  The USDA says dry weather and favorable market conditions were supportive of another large supply of cattle.  Forage reserves have been depleted, grass has been slow to take off, and there are concerns about available feedstuffs.  Receipts were up on the week and the year.  Feeder supply included 55% steers and 44% of the offering was over 600 pounds.  Medium and Large 1 feeder steers 502 to 549 pounds brought $244 to $271 and feeder steers 853 to 895 pounds brought $190 to $200.  Medium and Large 1 feeder heifers 453 to 496 pounds brought $219 to $241.50 and feeder heifers 703 to 745 pounds brought $192.50 to $207.75. 

Boxed beef closed lower on light demand for fairly light offerings.  Choice closed $.15 lower at $309.09 and Select closed $1.54 lower at $287.12.  The Choice/Select spread of $21.97. Estimated cattle slaughter was 126,000 head – up 4,000 on the week and even on the year. 

Lean hog futures ended the day lower, pressured by demand uncertainty, the lower midday pork, and contracts’ premium to cash.  June lean hogs closed $1.95 lower at $88 and July lean hogs closed $2.10 lower at $89.32. 

Cash hogs closed mixed with a solid negotiated run.  So far this week, processors, for the most part, have been more aggressive in their procurement efforts and have bid up to move needed numbers.  There are two specific areas the market is monitoring closely: Demand, both globally and domestically.  How it ebbs and flows could provide some indication of where prices could head.  And the availability of market-ready hogs.  And as long as that is ample, the market will continue to move at the will of processors. Barrows and gilts at the National Daily Direct closed $.56 lower with a base range of $70 to $77 and a weighted average of $73.33; the Iowa/Minnesota closed $.38 higher with a weighted average of $75.63 the Western Corn Belt closed $.31 higher with a weighted average of $75.52.  Prices at the Eastern Corn Belt were not reported due to confidentiality. 

Butcher hog prices at the Midwest cash markets are steady at $44 and $2 lower at $46 in Red Oak, Iowa. At Illinois, slaughter sow prices were $1 lower with moderate demand for heavy offerings at $13 to $22.  Barrows and gilts were steady with moderate demand for moderate offerings at $40 to $50.  Boars ranged from $15 to $25 and $5 to $10. 

Pork values closed lower – down $2.01 at $80.07.  Hams, bellies, ribs, picnics, and loins were lower.  Butts were higher.   Estimated hog slaughter was 467,000 head – down 10,000 on the week and down 12,000 on the year.  Tuesday’s hog slaughter was revised to 470,000 head. 

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