GENERAL COMMENTS: This week's cash cattle trade was mostly done by Thursday, with prices falling $3 to $5 per cwt from last week's levels. Live business took place at $123 to $124, while dressed trade moved to $198 to $200 per cwt. According to the closing report, the national hog carcass base is $0.06 lower ($72-$83.75, weighted average $78.94). Corn futures settled fractionally higher Friday and 7 cents higher through the week of rain delays during prime planting season. The stock market closed modestly higher but didn't hit fresh highs, up 28.12 points in the S&P 500 Index (2,945.64).
LIVE CATTLE: According to this week's CFTC report, speculative 'Managed Money' in the live cattle futures market have been frantically selling off previous bullish positions, but they still hold 15 long contracts for every short contract. Therefore, the selling pressure may not be over yet despite a drop of $9.25 per cwt already since Easter. Friday's close showed the nearby June contract down just $0.250 but all other contracts down $1 per cwt or more. Beef cut-outs: lower, off $1.79 (select, $213.29) to $1.44 (choice, $227.36) with light demand and moderate offerings (107 total load count of cuts, trimmings, and grinds).
MONDAY'S CASH CATTLE CALL: Steady. Monday's activity will be limited to the collection of new showlists. Packers won't feel much urgency given the bearish context of outside trade.
FEEDER CATTLE: For the week, May feeder cattle futures lost $6.80 per cwt, with $1.825 of that coming off on Friday alone. The pace of the futures slide has been unrelenting, and that nearby contract has lost $18.150 since hitting its March high. This occurs alongside the speculative sell-off in live cattle futures, but notably in feeders, the speculative 'Managed Money' traders have been adding fresh bearish short positions even faster than they've been selling off previously bullish long positions. CME cash feeder index for 05/02: $141.18, off $2.72.
LEAN HOGS: Unperturbed by the stunning multi-day losses in the cattle market, hog futures spent Friday considering how much of their recent China-related gains should still be maintained. The nearby contract was down $0.750 Friday and down $1.650 for the week. The August contract, meanwhile, was up $0.625 Friday and up $2.200 for the week, still showing that bullish concern about the U.S. industry's ability to meet this summer's upcoming demand. Carcass value closed lower Friday with sudden steep losses in bellies (down $7.47) and ribs (down $7.01). Pork cut-out: $82.01, down $1.91. CME cash lean index for 05/01: $83.23, down $0.10 (DTN Projected lean index for 05/02: $83.02, down $0.21).
MONDAY'S CASH HOG CALL: Steady to $1 lower. Hog buyers are expected to resume work Monday with some degree of uncertainty.
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