GENERAL COMMENTS:
All three sectors were able to close the day higher and secure more market position and interest through closing Tuesday. The feeder cattle and lean hogs markets were the most optimist, but the live cattle contracts weren't far behind and look for higher cash prices later this week. Hog prices close higher on the National Direct Afternoon Hog Report, up $2.05 with a weighted average of $50.05. March corn is up 5 1/4 cents per bushel and March soybean meal is up $1.10. The Dow Jones Industrial Average is down 165.89 points and NASDAQ is up 1.56 points.
LIVE CATTLE:
Feeders see the quiet day as almost a relief that packers are pushing the doors again this week and wanting to kick trade off early in the week. Not to mention, feeders want to take their time feeling out this week's market as the board is adding more and more support as time ticks on. February live cattle closed $0.60 higher at $121.42, April live cattle closed $0.27 higher at $120.60 and June live cattle closed $0.20 higher at $112.20. The live cattle market was the most conservative of the three on Tuesday, but little incremental gains can still make powerful movements over time. Cash cattle trade was more or less obsolete Tuesday afternoon as both sides want to see how the week's attitude develops before prices are arranged.
Boxed beef prices close lower: choice down $1.13 ($206.13) and select down $2.45 ($203.73) with a movement of 128 loads (62.91 loads of choice, 22.87 loads of select, 10.55 loads of trim and 31.44 loads of ground beef). Tuesday's slaughter is estimated at 123,000 head, 1,000 head more than last week and 7,000 head more than a year ago.
WEDNESDAY'S CASH CATTLE CALL: $1.00 to $2.00 higher. Given that cash cattle trade has been lower the last couple of weeks, and with the board seeming to put a bottom in this market, I see prices being fully higher this week.
FEEDER CATTLE:
Feeder cattle prices held strong through closing and continued to pull prices out of the whole the market has been in over the last couple of weeks. March feeders closed $0.77 higher at $139.30, April feeders closed $0.40 higher at $141.77 and May feeders closed $0.57 higher at $143.77. Wrapping up the day with steady gains throughout the complex levels the market and allows investors to feel as if the momentum is stable and secure, which will hopefully continue to trickle into the rest of the week.
Last Friday, at the Public Auction Yards in Billings, Montana, 2,230 head of feeders sold in comparison to the last week's sale steer calves weighing less than 600 pounds sold most $5.00 to $10.00 higher, steers weighing 600 pounds and heavier sold steady to firm. All weights of heifer calves sold generally steady. Demand for cattle suitable to run on grass was mostly good as order buyers competed with farmer feeders for offerings. Many buyers were actively bidding on feeders and consequently created a very active market. The CME feeder cattle index 2/17/2020: not available at this time.
LEAN HOGS:
Moderate gains were held throughout the lean hog complex as the day closed and market closed anywhere from $0.10 to $1.20 higher. April lean hogs are up $1.20 at $65.50, May lean hogs are up $0.55 at $73.55 and June lean hogs are up $0.47 at $81.37. Most of the market's interest lies in the new April spot contract and traders are least interested in buying into the May contract at this time. Stable gains in both the cash market and future market help support the market's movement. Pork cutouts totaled 365.53 loads with 321.35 loads of pork cuts and 44.18 loads of trim. Pork cutout values: up $2.15, $65.01. Tuesday's hog slaughter is estimated at 494,000 head, 2,000 head less than last week and 18,000 head more than a year ago. The CME lean hog index 2/13/2020: down $0.41, $55.97.
WEDNESDAY'S CASH HOG CALL: Slightly higher. After a big day of gains on Tuesday, Wednesday will most likely keep the market's direction, but it could be at a smaller scale, which isn't a bad thing. Gains little by little can be just as powerful as days of massive movement.
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