Friday Closing Livestock Market Summary

GENERAL COMMENTS

Light-to-moderate trade developed in several cattle feeding states. Live sales in Texas were marked at $117, generally $3 lower than last week. On the other hand, dressed deals in the North ranged from $187-$188, $2-$3 lower. The national hog base closed off $1.03 compared with the prior day settlement ($76-$82.75, weighted average $80.98). From Friday to Friday, livestock futures scored the following changes: Aug LC off $3.52; Oct LC off $4.98; Aug FC off $6.90; Sep FC off $6.05; Aug LH up $0.30; Oct LH off $0.72. Corn futures closed fractionally higher, but ended up about a nickel lower on the week thanks to more friendly growing weather across much of the Corn Belt. The stock market closed mixed with the Dow off 33 and the NASDAQ off 7.

LIVE CATTLE

Futures closed moderately to sharply lower off 37-140. Most contracts were pressured by long liquidation and ideas of worsening fundamentals through much of the third quarter. Trading also seemed to be bothered by news that Japan would soon impose higher tariffs on frozen beef imports. The first five contracts closed the week well below 100-day moving averages. Beef cut-outs: steady (choice, $206.22 off $0.21, select $196.82 up $0.16) on light-to-moderate demand and offerings (53 loads of choice cuts, 19 loads of select cuts, 03 loads of trimmings, 19 loads of coarse grinds).

MONDAY'S CASH CATTLE CALL:

Steady to $2 lower. Monday will be typically slow as packers limit efforts to the collection of new showlists. We expect ready numbers to be generally larger than this week.

FEEDER CATTLE

Futures closed mostly sharply lower, off 185 to up 2. Feeders put in a tough week thanks in part to last week's midyear herd inventory, which suggested a growing number of feeder cattle outside of feedlots. Commercial selling was also encouraged to buy the discount structure of deferred live futures. CME cash feeder index: 07/27: $149.36, off $1.94.

LEAN HOGS

Futures closed mixed, up 115 to off 117. Nearby issues lost ground to 2018 contracts. Large fourth-quarter discounts reflected concerns about late-year supplies and the markets ability to find sufficient demand to minimize price erosion. Note that December closed at 61.05, the lowest price level seen since April 26. Pork cut-out: $98.75 (FOB plant) off $1.19. CME cash lean 07/26: $89.39, off $0.45 (DTN Projected lean index for 07/27: $88.75, off $0.64).

MONDAY'S CASH HOG CALL:

$1 lower. Hog buyers will start out next week on the defensive, troubled by signs of increasing market numbers and struggling pork demand.