Friday Closing Livestock Market Summary - Hogs Close Wild Week With Limit-Up Gains

GENERAL COMMENTS: From Friday to Friday, livestock futures scored the following changes: Apr LC off $0.58; Jun LC up $0.97; Mar FC off $2.60; Apr FC off $0.77; Apr LH up $8.25; May LH up $8.98. The week's light-to-moderate cash cattle trade developed Wednesday and Thursday with Southern live deals ranging from $126 to $127, generally $1 lower than last week's weighted averages. Northern dressed business ranged from $203 to $205, also $1 lower than last week's weighted averages. According to the closing report, the national hog base is $1.08 higher ($46-$54, weighted average $51.52). That's $6.72 higher than week-ago numbers, so the hog rally is both a futures and cash market phenomenon. Corn futures (and all grain and oilseed contracts) closed higher Friday amid speculative short-covering, with the May contract netting a weekly gain of 18 1/2 cents. The stock market closed modestly higher, up 14 points Friday in the S&P 500 and netting gains of 2.9% for the week.

LIVE CATTLE: It has been an exciting week of weather in the actual feedlots and highways where cattle are fed and transported, but not a particularly impressive week in the futures market. The April contract, closing Friday at $129.100, has been unable to spark any re-test of the market's March 1 high. Beef cut-outs have trended higher over the past week, seen at $227.70 choice (up $1.66 over week-ago numbers) and $218.76 select (up $0.22 over week-ago numbers).

MONDAY'S CASH CATTLE CALL: Steady. Monday's activity will be limited to the collection of new showlists. We look for the offering to be steady around $127 live/$204 dressed.

FEEDER CATTLE: There are no official numbers or estimation of cattle death loss associated with the severe flooding in Nebraska and the overall rotten calving weather experienced across the western Plains recently, but ultimately, there will likely be effects to the size of the U.S. calf crop. Futures gains of up to $2.275 in the April contract may show some recognition of those weather and logistics challenges. The October contract surged to a contract high of $154.175. CME cash feeder index for 03/14: $137.65, off $0.74.

LEAN HOGS: Lean hog futures contracts closed limit-up ($3.000) in every contract through April 2020 and will trade with expanded limits when the market re-opens on Monday. The August contract shows the highest expectation for seasonal bullishness (and potential for more export bullishness), closing at $89.750, up a whopping $9.075 for the week. During this week's wild rally in hog prices, total open interest in the futures market has actually been growing, so there is more going on here than just panicky speculators ditching their previous net-short positions. Fresh bullish positions are also being added by traders convinced of the severity of China's African swine fever epidemic. Carcass value closed slightly higher Friday but was up a total of $4.64 from week-ago numbers. Pork cut-out: $68.89, up $0.09. CME cash lean index for 03/13: $54.13, up $1.01 (DTN Projected lean index for 03/14: $55.40, up $1.27).

MONDAY'S CASH HOG CALL: Steady to $1 higher. Hog buyers are expected to resume work Monday with firm bids to reflect the bullishness pulsing throughout this market.

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