GENERAL COMMENTS:
Monday's aren't most people's favorite day of the week but following a soft cash market makes it even worse. The lean hog complex was able to keep the support in the deferred contracts, which helped gain some slight position. Cash hog prices were higher through closing on the National Direct Afternoon Hog Report, up $0.09, with a weighted average of $50.31. March corn is down 1 3/4 cents per bushel and March soybean meal is up $2.10. The Dow Jones Industrial Average is up 174.31 points and NASDAQ is up 107.88 points.
LIVE CATTLE:
Live cattle contracts had a rough start to the week as nearby contracts dropped, with losses around $1.00 and deferred contracts following close behind. Seeing that it's too early in the week for cattle to trade, live cattle contracts didn't have much support to help lift contracts higher after coming off consecutive weeks of lower cash trade. Seeing that packers have cattle committed for next week and are backing off on kills, it probably won't be a good week for feeders again. February live cattle closed $1.02 lower at $120.30, April live cattle closed $1.12 lower at $118.67 and June live cattle closed $0.82 lower at $110.45.
Boxed beef prices are lower: choice down $1.21 ($208.91) and select down $0.19 ($203.70) with a movement of 99 loads (49.65 loads of choice, 28.40 loads of select, 5.63 loads of trim and 15.74 loads of ground beef). Monday's slaughter is estimated at 119,000 head, 2,000 head less than last week and 1,000 head more than a year ago.
TUESDAY'S CASH CATTLE CALL: Steady to slightly lower. When trade does surface this week, it wouldn't be surprising to see lower prices since packers have backed off on their kill schedules and winter weather is making road conditions icy in some areas.
FEEDER CATTLE:
Nearby contracts closed slightly higher while deferred contracts closed with losses over $1.00. March feeders closed $0.50 higher at $135.70, April feeders closed $0.02 higher at $137.52 and May feeders closed $0.12 lower at $139.45. Last Friday at Lexington Livestock Market in Lexington, Nebraska, 3,231 head of feeders sold and in comparison to last week, steers weighing 550 to 850 pounds sold steady to $2.00 higher, heifers weighing 450 to 550 pounds sold $3.00 higher and heifers weighing 550 to 800 pounds sold $5.00 lower. Winter weather will begin to play a role in the ability to sell and market both calves and feeders coming to town. The large runs of light weight calves are going to become harder and hard to find, making them a premium in the spring for grass calves. The CME feeder cattle index 2/7/2020: down $0.22, $140.41.
LEAN HOGS:
A mixed close in the lean hog complex isn't a bad way to end the day. The market closed in the same way it opened with nearby contracts lower and deferred contracts somewhat higher. February lean hogs are down $0.90 at $56.20, April lean hogs are down $1.17 at $65.07 and May lean hogs are down $0.45 at $74.40. Pork cutouts totaled 313.36 loads with 274.17 loads of pork cuts and 39.19 loads of trim. Pork cutout values: up $0.21, $65.02. Monday's slaughter is estimated at 496,000 head, steady with a week ago and 57,000 head more than a year ago. The CME lean hog index 2/6/2020: down $0.87, $59.57.
TUESDAY'S CASH HOG CALL: Steady. The board isn't completely willing and ready to move higher, but knowing that the cutout values are gaining value and the cash market is able to trade higher is a good sign.
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