GENERAL COMMENTS:
The livestock complex didn't fare too well this week. The lean hog market seemed to have a good run, then the board sold off Friday but cash prices thankfully stayed the course. Hog prices are higher on the National Direct Afternoon Hog Report, up $0.59 with a weighted average of $52.73. March corn is down 6 1/2 cents per bushel and March soybean meal is down $0.60. The Dow Jones Industrial Average is down 170.36 points and NASDAQ is down 87.57 points.
From Friday to Friday livestock futures scored the following changes: February live cattle down $1.50, April live cattle down $2.95; January feeder cattle down $3.50, March feeder cattle down $5.32; February lean hogs down $0.45, April lean hogs down $0.65.
LIVE CATTLE:
One week of steady cash cattle prices was acceptable, but feeders are having a hard time swallowing the fact that fats sold again for most steady money this week. Cash cattle trade was strange this week, taking place mostly on Wednesday with a little bit of clean up on both Thursday and Friday. Trade was fully steady in the South at $124 and steady to $1.00 lower in the North at $199 to $199. It didn't help that the board was anxious all week and traded lower most days. Near Friday's close there started to be some slightly optimism in the nearby contracts, as buyers saw some buying potential. February live cattle close $0.17 higher at $124.85, April live cattle closed $0.12 higher at 124.30 and June live cattle closed $0.30 lower at $116.02.
Boxed beef prices are lower: choice down $0.83 ($214.49) and select down $0.50 ($210.70) with a movement of 100 loads (62.84 loads of choice, 16.18 loads of select, 5.57 loads of trim and 15.11 loads of ground beef). Friday's slaughter is estimated at 122,000 head, 6,000 head more than a week ago and 5,000 head more than a year ago. Saturday's slaughter is expected to be 35,000 head.
MONDAY'S CASH CATTLE CALL: Steady. Coming off Friday's slightly bearish COF report, the market will potentially keep in its same lower nature. A lot of pressure is sitting on the cash cattle market as feeders will have to strategically play their cards if they want to see the prices that the first quarter typically yields.
FEEDER CATTLE:
Simply put, feeder cattle contracts had a rough week with little hope to ever trade higher through this week's tumble. As the cash cattle market sold early and for steady money -- and dipped lower and lower on the board -- the feeder cattle complex had little room to move higher. January feeders closed $0.92 lower at $141.85, March feeders closed $0.85 lower at $139.67 and April feeders closed $0.97 lower at $142.50. On Thursday at the Ogallala Livestock Auction in Ogallala, Nebraska, 5,215 feeders sold compared to last week steers were $1.00 to $4.00 higher, except 700 pound steers were $3.00 lower. Heifers were steady to $5.00 lower, except 550 pound heifers were $6.00 higher. The CME feeder cattle index 1/23/2020: not available at this time.
LEAN HOGS:
The lean hog complex closed Friday on a split note -- the board is lower, but cash prices are still higher. Lean hog contracts dipped $0.90 to $1.90 lower with nearby contracts taking the hardest hit. February lean hogs are down $1.27 at $67.22, April lean hogs are down $1.90 at $73.45 and May lean hogs are down $1.80 at $79.97. Although the board may be exhausted of this week's really and gave up significant positioning Friday afternoon, its positive that Friday's slaughter was aggressive and Saturday's slaughter is expected to be larger as well. The big push in slaughter most likely comes from the shortened week and plants being dark on Monday, but instead of keeping their normal tempo, packing plants are pushing aggressively into the weekend to meet demand.
Pork cutouts total 298.26 loads with 266.40 loads of pork cuts and 31.68 loads of trim. Pork cutout values: down $1.46, $77.38. Friday's slaughter is estimated at 494,000 head, 54,000 head more than last week and 25,000 head more than a year ago. Saturday's slaughter is expected to be 332,000 head. The CME lean hog index 1/22/2020: up $0.27, $61.29.
MONDAY'S CASH HOG CALL: Steady. Next week may be a little slower for the lean hog market as this week was aggressive and snappy in its progression.
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