Thursday Closing Livestock Market Summary - Cattle Futures Fade in Late Day Trade

GENERAL COMMENTS

Cash cattle interest remains undeveloped with bids moving little from when packers first rolled out offers earlier in the week. Bids are stated in the North at $108 live basis and $175 dressed basis. This is still well below asking prices of $115 and higher in the South, and $182 to $185 in the North. At this point it appears that trade will be delayed until Friday. According to the closing report, the national hog base is $0.01 lower compared with the Prior Day settlement ($58.00 to $66.00) weighted average $64.79. The corn futures are lower in light activity. July futures were 4 cents lower Thursday. The Dow Jones Index is 69 points lower with the Nasdaq down 3 points.

LIVE CATTLE

Late day selling pressure flooded through live cattle trade with prices in nearby contract posting triple-digit losses ($0.35 to $1.05 lower). Narrow gains developed early in the session based on spillover support seen in the feeder cattle market. However, the lack of additional trade volume moving into the market allowed traders to focus on market adjustments and position taking opportunities late in the day. June and August futures led the market lower with prices holding $1 losses. Beef cut-outs: lower, $0.11 lower (select, $204.93) and down $1.08 (choice, $229.00) with moderate demand and light offerings (81 loads of choice cuts, 38 loads of select cuts, nine load of trimmings, 19 loads of coarse grinds).

FRIDAY'S CASH CATTLE CALL:

Steady to $2 lower. It appears that cash cattle markets will be delayed until sometime Friday, with a mid-to-late day trade a possibility. Even though both sides desire to get business done earlier than later in front of the holiday weekend, late Friday trade is a possibility.

FEEDER CATTLE:

Early support eroded at the closing bell, allowing most contracts to shift lower Thursday ($0.60 lower to $1.50 higher). Lightly traded May futures was the only contract to hold gains at the closing bell on Thursday. This may draw additional activity back into the market late in the week, but the upcoming holiday weekend is allowing all livestock markets to remain lightly traded. This could limit additional activity through the rest of the week as prices could shift lower based on traders trying to adjust to the sharp gains seen over the last several days. CME cash feeder index for 5/23 is $134.44 up $1.01.

LEAN HOGS:

ight gains trickled into the lean hog complex in the late minutes of trade Thursday ($0.02 to $0.55 Higher). Even though the complex posted losses through most of the session, the overall lack of active trade interest in the market allowed traders to adjust prices higher before the closing bell. The ability to hang onto midweek gains and continue to push steady to higher prices through the end of the week and into the Memorial Day holiday weekend will help draw additional underlying buyer support through the complex. Pork prices shifted lower following an aggressive $20 per cwt loss in Rib values through day. Other primal cuts remained mixed in a moderate price range. Pork cut-out: $74.11 down $0.70. CME cash lean index for 5/22 $69.03 up $0.34. DTN Projected lean index for 5/23 $69.72 up $0.69.

FRIDAY'S CASH HOG CALL:

Steady to 50 cents lower. Sluggish activity is expected late in the week with early Friday trade expected to be generally steady to 50 cents lower. Most bids are expected steady with limited trade seen through the day. Total slaughter numbers Friday are expected to be 444,000 head. Saturday runs are likely to be seen near 30,000 head.