Thursday Closing Livestock Market Summary - Longs Continue to Run From Summer Lean Hog Futures

GENERAL COMMENTS

While a few more bids were tossed on the cattle table (e.g., $121 in the South, $192 in the North), no buyers were willing to show enough powder needed to generate selling interest. Some steers and heifers were priced around $125 live in the South and $200-$203 in the North. According to the closing report, the national hog base is $0.02 higher ($52-$59, weighted average $58.32). Corn futures closed fractionally lower at the conclusion of a listless round of trading. The stock market seemed to reclaim traction Thursday with the Dow closing 238 points and the Nasdaq advanced by 114.

LIVE CATTLE

Reflecting higher cut-outs and general optimism regarding the eventual surfacing of higher feedlot sales, spot April successfully closed 60 points higher. Yet the balance of the trading field closed 27 to 125 lower. June through October settled with triple-digit losses. Summer contracts remain trapped below 40-day moving averages and 38% retracement of the Jan-Mar price break. Beef cut-outs: significantly higher, up $1.33 (select: $204.48) to $1.55 (choice: $220) with moderate-to-good demand and moderate-to-heavy offerings (78 loads of choice cuts, 37 loads of select cuts, zero loads of trimmings, 23 loads of ground beef).

FRIDAY'S CASH CATTLE CALL:

Steady to $2 higher. Friday will mark another round of now-or-never time. Look for at least moderate trade volume to develop sometime between late morning and early afternoon.

FEEDER CATTLE:

Spot April expired Thursday at high noon (i.e., 140.177, up 32 points, a little above the lagging cash index). All other contracts settled 32 to 105 lower, obviously pressured by struggling live prices. The August contract once again bumped its head on 62% retracement of the first-quarter sell-off. 04/25: $139.49, up $1.39.

LEAN HOGS:

Lean futures closed 10 to 135 lower with the first three contracts catching the most bearish heat. Traders continue to fear that summer premiums remain too much of a challenge for the cash market. Yes, seasonal chain speed will be slower but still faster than a year ago. Furthermore, many are worried that wholesale pork demand (as well as export demand) will lose a step or two compared with the aggressive buying pace of 2017. Carcass value closed moderate lower, pressured by processing items, ribs and picnics. Pork cut-out: $67.85, off $0.64. CME cash lean index for 04/24: $60.44, up $1.44 (DTN Projected lean index for 04/25: $61.23, up $0.79).

FRIDAY'S CASH HOG CALL:

Steady. Look for near-steady bids in hog country Friday with most packers having immediate slaughter needs pretty much in hand.