Friday Closing Livestock Market Summary - Cattle Futures Close Opening Round of 2019 Business With Triple-Digit Losses

GENERAL COMMENTS: Light-to-moderate trade volume was noted in parts of the North at $195 on a dressed basis, steady with last week's weighted average basis Nebraska. On the other hand, additional business in the South was tough to identify. Most regional biz may have been completed on Thursday (i.e., $125 live, steady). The national hog carcass base closed $0.79 higher ($45.50-$50, weighted average, $48.22). March corn closed up 3 1/4 cents at $3.83, benefiting further from light rain amounts and hot temperatures in the seven-day forecast for southern Brazil. At the same time, chances for heavy rains remain in the forecast for northern Argentina, and that is also a threat to developing row crops as local flooding is possible. Jazzed by aggressive job growth in December (312,000), the stock market recovered with a vengeance: The Dow advanced by 746 points and the Nasdaq gained 275. From Friday to Friday, livestock futures scored the following changes: Feb LC, off $2.25; Apr LC, off $2.40; Jan FC, off $4.17; Mar FC, off $4.05; Feb LH, up $1.30; Apr LH, up $0.25.

LIVE CATTLE: With feedlot cash holding firm and live futures staging a solid late-week retreat, the early year board seems comfortable for the movement living with a strange kind of disconnect. Disregarding evidence of cash premium (i.e., $125 live; $195 dressed), live issues closed the week sharply lower, off 92 cents to $1.40. Beef cut-outs closed lower with the choice box off $1.98 ($214.51) and its select counterpart down as much as $1.72 ($207.66). Wholesale demand was called light to moderate on heavy offerings.

MONDAY'S CASH CATTLE CALL: Steady to $2 higher. Activity in feedlot country Monday will be typically slow with buyers limiting efforts to the assessment of new showlists. We believe the new offering will be about steady.

FEEDER CATTLE: While daylight has just broken over 2019, feeder futures are definitely feeling the hotter rays of higher corn prices. Once again, feeder contracts broke sharply lower Friday with triple-digit losses (off 92 cents to $1.62) surfacing on the close, pressured by strength in the corn trade and fears of rising costs of gain. CME cash feeder Index for 01/03: $145.60, off $0.46.

LEAN HOGS: 2019 lean hog issues closed moderately lower, off 10 to 75 cents. At the same time, modest progress was posted throughout 2020 (up 12 to 20 cents). Carcass value closed modestly lower. The pork cut-out for 01/03 totaled $69.70, off $0.20. Lower fresh cuts and picnics were partially offset for better demand for bellies and ribs. (DTN Projected lean index for CME cash lean index for 01/03: $53.63, up $0.38) CME cash lean index for 01/02: $53.25, up $0.17.

MONDAY'S CASH HOG CALL: Steady to $1 higher. Look for the cash hog trade to open on Monday with steady/firm bids.

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