GENERAL COMMENTS:
Livestock futures shifted higher and lower through the session Friday as traders focused on end-of-the-week position-taking following previous gains. This may spark renewed buyer support Monday morning. From Friday to Friday, livestock futures scored the following changes: Apr LC up $0.35; Jun LC up $1.35; Apr FC up $0.90; May FC up $1.45; Apr LH up $1.65; May LH up $9.68. Light cash cattle trade developed through the North early afternoon Friday with prices mostly $126 per cwt live and $204 to $205 dressed. This is generally steady with last week's average. Some additional trade is likely to develop through the North the rest of Friday afternoon and evening, but the tone has likely been set with most late trade expected to be in the current market range. Activity is quiet in the South without any additional bids. This indicates that trade in the South is likely finished for the week following the trade seen Wednesday. The National Daily Direct afternoon hog report was $0.69 lower ($67-$78.50, weighted average of $75.79) on 6,819 head sold. Corn futures were lower in light-to-moderate trade with May down 2 3/4 cents per bushel. The Dow Jones Index was 19 points higher with Nasdaq up 40 points.
LIVE CATTLE: Live cattle futures were pressured Friday as traders took profits. Futures settled steady to $1.50 lower. Despite triple-digit losses in the nearby trade, the market is firming as traders have moved off of support levels set early in the week. The aggressive gains seen Thursday led to position-squaring ahead of the weekend. All contracts bounced off of morning lows as buyers stepped back into the complex at closing bell. The June contract rallied off of short-term lows of $119 per cwt, which is likely to spark additional trade early next week. Beef cut-outs: higher, up $1.92 (select, $220.28) to up $0.19 (choice, $226.93) with good demand and moderate offerings of 132 loads (59 loads of choice cuts, 22 loads of select cuts, 40 load of trimmings, 12 loads of coarse grinds).
MONDAY'S CASH CATTLE CALL: Steady. Following the cash market trade that trickled in through the last half of the week, both sides are expected to reassess needs on Monday. Showlist distribution and inventory-taking will be the main items on the agenda, with bids and asking prices not likely until later in the week.
FEEDER CATTLE: Feeder cattle futures closed mixed ($0.47 lower to $0.32 higher) on end-of-the-week position-taking. While futures were under pressure through most of the session, buyers slowly but steadily moved back into the complex in the last hour of trade as traders squared positions following Thursday's market rally. Thursday's move changed the tone of the market, creating a market reversal in all feeder cattle trade. There is strong potential for follow-through support early next week as traders focus on potential short- and long-term demand. CME cash feeder index for 4/3 is $142.88, up $0.44.
LEAN HOGS: Late-day gains in lean hogs offset wide swings earlier in the day. Futures closed mixed, $0.55 lower to $2.17 higher. There continues to be an extremely wide gap between buyer support in the spot April contract and the June contract. April rallied $1.67 per cwt through the week, while June gained $10.47 per cwt. Even though the April contract remain lightly traded, this still has an influence on the cash markets and spot-market direction. Traders flooded into the hog complex on hopes of a trade deal with China. Expectations that African swine fever will continue to create a need for imported pork to China has traders stepping to summer contracts and beyond. The most aggressive support Friday developed in October and December contracts. This indicates that this interest is focusing on long term market direction. Pork cutout prices shifted slightly lower Friday on spot-market uncertainty. Pork cutout values fell $0.38 per cwt, moving to $81.84 per cwt on 217 loads. CME cash lean index for 4/3 is $78.26, up $0.56. DTN Projected lean index for 4/4 $78.53, up $0.27.
MONDAY'S CASH HOG CALL: $1 lower to $1 higher. Moderate cash market swings are expected early next week, based on the tension between spot trade and futures direction. Most bids are expected to be steady to 50 cents higher, although the underlying tone of the market is firming once again. Monday slaughter is expected at 475,000 head.
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