Friday Closing Livestock Market Summary - Mixed Trade at End of Week

GENERAL COMMENTS

From Friday to Friday, livestock futures scored the following changes: Feb LC off $2.10; Apr LC off $2.80; Mar FC off $3.72; May FC off $3.45; Apr LH up $3.22; May LH up $2.68. Cash cattle trade was light to moderate during the day with clean-up activity seen in all areas. Prices were generally steady with the previous week's trade as the tone of the market was set midweek. Live cattle trade held at $128 per cwt while dressed activity was seen from $204 to $206 per cwt, with most sales steady to $1 per cwt lower than the week previous. It is likely that active market trade will not develop until midweek or later next week, which could limit additional market direction. According to the closing report, the national hog base is $0.93 lower compared with the Prior Day settlement ($57.00-$63.75) weighted average $62.63. Corn futures were lower in light activity with March futures down 1/2 cent Friday. The Dow Jones Index is 347 points higher with the Nasdaq up 127 points.

LIVE CATTLE

Narrow trading ranges developed late in the day Friday following what turned into moderate-to-strong pressure through most of the session. Prices were contained to a narrowly mixed range as traders tried to adjust positions for the weekend ($0.22 higher to $0.52 lower). Narrow losses developed in nearby cattle trade, but late-day market shifts helped to bring light buyer activity back to the table. USDA reported Friday that Cattle on Feed totals as of Feb. 1 increased 0.5% over early market estimates. This is not expected to have a major impact on the market, as marketing levels in January were on target with expectations. The main focus will be on the increased placements in January, which will likely add to the weakness in the market next week. Beef cut-outs: mixed, $0.76 higher (select, $212.82) and down $0.03 (choice, $218.37) with light demand and offerings (25 loads of choice cuts, 15 loads of select cuts, 4 load of trimmings, 29 loads of coarse grinds).

MONDAY'S CASH CATTLE CALL:

Steady. Activity and interest in the cattle markets early next week will likely follow trade that developed through the middle of the week. Interest in the cash market is likely to be limited to showlist distribution and inventory taking most of Monday.

FEEDER CATTLE:

Mixed feeder cattle trade developed late Friday as traders tried to anticipate the January Cattle on Feed report. This left prices in a narrow trading range following early market shifts ($0.52 lower to $0.42 higher). Traders stepped into the market at the end of the week with the intention of trying to square positions and cover short positions before the weekend. But this only had limited success, as the overall tone of the market still remains weak, and sparked another round of selling through early trade. Total placements in January came in 3% over the early estimate and above all market ranges. This is likely to have a weakening effect on the market once markets open Monday. CME cash feeder index for 2/22 is $147.63, down $0.42.

LEAN HOGS:

Light trade was seen Friday as traders focused more on market corrections than any significant market shifts over the last couple of days. This left prices mixed in a narrow range (0.02 lower to 0.17 higher). Early market activity was offset by position-taking through the last half of the trading session with early losses quickly being eroded through the day. Even though gains remained narrow at closing bell, the focus on market firmness continues to be the main direction in the complex as traders look for increased activity early next week. Pork prices bounced higher on firm support in most primal cuts. All cuts except ham markets posted gains at the end of the week, allowing firm overall market support. Pork cut-out: $79.48 up $0.78. CME cash lean index for 2/21 $70.17, down $0.61. DTN Projected lean index for 2/22 $69.78, down $0.39.

MONDAY'S CASH HOG CALL:

Steady to $1 lower. Limited overall trade activity is expected to be seen over the next few days with traders still focusing on the weakening market range steady to $1 per cwt lower. Most bids are expected to remain steady early in the week with more focus on futures trade activity late in the month. Processing schedules are expected to be 462,000 head Monday.