GENERAL COMMENTS:
Being involved in agriculture through the
COVID-19 pandemic seems a lot like walking through a field of landmines.
Some of the mines are false alarms and some of them are lively and
explosive. The constant panic and fear that producers and traders are
enduring is both exhausting and an extremely heavy burden to carry.
Being a rancher in the 21st century isn't a simple job, but add the
unexpected turn of events that COVID-19 brings to the table and it's a
whole new ball game.
Hog prices close lower on the National Direct
Afternoon Hog Report, down $0.53 with a weighted average of $34.20,
ranging from $31.00 to $38.00 on 6,476 head sold. July corn is down 3
cents per bushel and July soybean meal is down $0.50. The Dow Jones
Industrial Average is up 260.01 points and NASDAQ is up 139.77 points.
From Friday to Friday, livestock futures scored
the following changes: April live cattle down $9.68, June live cattle
down $3.68; April feeder cattle up $0.27, May feeder cattle down $1.83;
June lean hogs up $7.80, July lean hogs up $2.75.
LIVE CATTLE:
Live cattle contracts swung hard at Friday and
fought hard to trade higher into closing. June live cattle closed $0.30
lower at $82.62, August live cattle closed $0.45 higher at $88.90 and
October live cattle closed $0.92 higher at $94.47. Friday's cash cattle
trade was mostly steady with the earlier part of the week's trade,
except for the cattle, which sold in the South around $5.00 weaker.
Heading into the weekend, all eyes and ears remain on the packing plant
situation as it continues to cripple the industry.
Friday's slaughter is estimated at 83,000 head,
4,000 head less than a week ago and 31,000 head less than a year ago.
Saturday's slaughter is estimated to be around 47,000 head, 7,000 head
more than the previous week. It's helpful that the plant in Greely,
Colorado, is now back up and running; though not at full production,
every little bit helps.
Friday's Cattle on Feed Report shared that
cattle and calves on feed were down 5%, placements were down 23% (the
lowest that placements have ever been since the series began in 1996, at
1.56 million head), and marketings up 13%.
Boxed beef prices close higher: choice up $9.08
($293.37) and select up $6.13 ($279.02) with a movement of 70 loads
(37.83 loads of choice, 6.73 loads of select, 13.67 loads of trim and
11.57 loads of ground beef).
MONDAY'S CASH CATTLE CALL: Steady. It's going to
be ugly for a while. The fact we are going on week three of reduced
kills has backed the industry up enough to the point where if all plants
came back on next week -- at fully capacity -- it would still take a
couple of weeks to work through the built-up supply.
FEEDER CATTLE:
Feeder cattle contracts closed Friday fully
higher, pushing contracts $0.02 to $0.85 higher for the day's close. May
feeders closed $0.17 higher at $117.45, August feeders closed $0.02
higher at $126.40 and September feeders closed $0.30 higher at $127.80.
All in all, the week traded largely sideways without gaining or losing
too much ground, which makes sense as traders are leery of the livestock
marketplace.
On Thursday, at Mitchell Livestock Auction in
Mitchell, South Dakot,a compared to last week, a lower under tone was
noted on a light test of steers up to 700 pounds. Steers 700 pounds and
up were steady to $3.00 higher, except 750 to 800 pound steers, which
were $10.00 lower. Heifers up to 650 pounds sold unevenly steady.
Heifers 650 to 750 pounds sold $6.00 to $9.00 higher, while heifers over
750 pounds sold $1.00 to $4.00 lower. The CME feeder cattle index
4/23/2020: down $0.93, $119.48.
LEAN HOGS:
Despite the pressure felt industry wide from
packing plant closures, the hog market successfully close higher and
traded higher most of the week. June lean hogs closed $0.10 lower at
$51.52, July lean hogs closed $0.30 higher at $54.67 and August lean
hogs closed $0.45 higher at $58.32. Pork cutouts total 325.37 loads with
277.16 loads of pork cuts and 48.21 loads of trim. Pork cutout values:
up $1.11, $77.48. Friday's slaughter is estimated at 361,000 head,
40,000 head less than a week ago and 88,000 head less than a year ago.
Saturday's production is estimated at 191,000 head. The CME lean hog
index 4/22/2020: up $0.92, $46.28.
MONDAY'S CASH HOG CALL: Lower. Given the
complexity and uncertainty of the marketplace, a lot can happen over the
weekend. But regardless of what happens, there's a surplus of hogs
built up that's pressuring the market.
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