GENERAL COMMENTS:
Well folks, we made it through another week. On one hand, we look at the week and appreciate the support that has accumulated on the board. On the other hand, we cuss, stomp the ground and yell at the sky as we look at cash prices for both cattle and hogs. The truth of the matter is that, until packing plants are able to run at full capacity and work through the built-up supply that has been growing on showlists, the cash market will probably be weaker.
In this scenario, there aren't fingers to be pointed anywhere other than at COVID-19. Packers want to be processing cattle as they have retail counters to restock and profits to capture. Feeders are sitting on pins and needles needing packers to buy cattle and the cow-calf guy hopes this turns around before this fall.
Hog prices closed lower on the National Direct Afternoon Hog Report, down $0.50 with a weighted average of $32.24 on 4,697 head sold. May corn is up 2 1/2 cents per bushel and May soybean meal is down $3.60. The Dow Jones Industrial Average is up 685.47 points and NASDAQ is up 114.00 points.
From Friday to Friday, livestock futures scored the following changes: April live cattle up $0.65, June live cattle up $1.93; April feeder cattle steady, May feeder cattle up $0.33; June lean hogs down $4.95, July lean hogs down $2.83.
LIVE CATTLE:
Live cattle contracts closed mostly higher other than in the nearby contracts where there was some pressure to trade lower. June live cattle closed $0.17 lower at $86.30, August live cattle closed $0.45 higher at $91.10 and October live cattle closed $0.72 higher at $96.12. Cash cattle have traded in the South for $105 and some light trade has developed in the North at $168, both prices steady with last week on very minimal trade.
Boxed beef prices closed higher: choice up $3.12 ($238.99) and select up $1.22 ($227.20) with a movement of 89 loads (57.26 loads of choice, 16.63 loads of select, zero loads of trim and 15.14 loads of ground beef). Friday's slaughter is estimated at 87,000 head, 1,000 head less than a week ago and 27,000 head less that a year ago. Saturday's slaughter is projected to be around 39,000 head.
MONDAY'S CASH CATTLE CALL: Steady. Monday is a long way away in this environment. With some states potentially re-opening activity, no one really knows how cash cattle trade will end up next week. If packing plants, for some reason, can whip COVID-19 and process at full speed, you can bet they will get to work -- if they can excite enough employees. If the virus continues to run through plants and concern health officials, prices will continue to be tough as supply builds with no outlet for cattle to go to in a timely manner.
FEEDER CATTLE:
Feeder cattle contracts closed out the week impressive considering the turmoil in our world is in. May feeders closed $0.80 higher at $119.27, August feeders closed $0.22 lower at $128.40 and September feeders closed $0.17 higher at $129.95. Sale barns fared OK this week if they were able to draw in a sizeable amount of calves to sell, which then interested buyers as green grass is starting to entice folks. At Lexington Livestock Market in Lexington, Nebraska, compared to two weeks ago, steers and heifers over 600 pounds sold $5.00 to $10.00 higher. Demand was moderate to good but was largely carried by internet bidders. The CME feeder cattle index 4/16/2020: up $1.20, $115.75.
LEAN HOGS:
The lean hog contracts didn't see as much advancements this week as the cattle contracts did, but a slow, steady progression can be more profound and powerful than fast choppy movements. June lean hogs closed $0.55 higher at $43.72, July lean hogs closed $0.85 higher at $51.92 and August lean hogs closed $0.97 higher at $56.40. Pork cutouts totaled 418.17 loads with 370.83 loads of pork cuts and 47.34 loads of trim. Pork cutout values: up $4.27, $60.13. Friday's slaughter is estimated at 413,000 head, 15,000 head less than a week ago and 18,000 head less than a year ago. Saturday's slaughter is projected to be around 214,000 head. The CME lean hog index 4/15/2020: down $0.81, $45.72.
MONDAY'S CASH HOG CALL: Lower (sadly). I've said it repeatedly this week, but the fact of the matter is that packing plant capacity and efficiency will be an issue for both hogs and cattle until speeds are back up to normal. And even once they are, there's going to be a built-up supply, which will be an ordeal to work through.
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