GENERAL COMMENTS:
Intense price pressure has swept through all livestock markets with expanded limits adding to the downward pressure. Live cattle futures have fallen $9 per cwt in the past two sessions as growing concerns of tumbling beef values and demand erosion caused trader liquidation. Hog prices are lower once again on the National Direct Afternoon Hog Report, down $3.76 with a weighted average of $44.61 .May corn is down 1 1/2 cent per bushel and May soybean meal is down $5.80. The Dow Jones Industrial Average is up 456.28 points and NASDAQ is up 82.84 points.
LIVE CATTLE:
The bad news in cattle trade continues to develop as expanded trading limits developed for the second consecutive day. This move pushed most nearby contracts to new contract lows and below support levels seen during the middle of March. Even though April futures are holding slightly above support levels, the lack of active trade in the April contract gives this limited leverage. The continued idling of JBS's beef plant in Pennsylvania does very little to change production capacity, but it does severely limit access to markets for producers in the Eastern half of the U.S. This points to how fragile local and regional markets can be even though it may not have a significant widespread impact on the entire industry.Live cattle contracts closed the day at the expanded limits mark, $4.50 lower throughout the complex. April live cattle closed $4.50 lower at $92.82, June live cattle closed $4.50 lower at $83.07 and August live cattle closed $4.50 lower at $84.60.
Cash cattle activity remained at a standstill Thursday with bids undeveloped heading into late afternoon. Although asking prices are holding above Wednesday's cash trade levels with cattle priced at $114 to $115 live basis in the South and $183 and higher dressed in the North, it will be another late week affair as both sides push any decisions into Friday.
Boxed beef prices lower: choice down $2.53 ($232.64) and select down $3.01 ($222.12) with a movement of 115 loads (64.44 loads of choice, 12.04 loads of select, 26.49 loads of trim and 12.42 loads of ground beef). Despite not hitting record daily losses for a third consecutive day, the significant pressure in meat values is adding increased weakness to the entire market.
FRIDAY'S CASH CATTLE CALL: Lower. Quiet cattle trade most of the day Thursday is setting up for more end of the week activity. Given the extreme pressure in the market, it is uncertain how many cattle will get sold this week, as some feeders may opt to hold onto cattle and wait for support next week.
FEEDER CATTLE:
Intense price pressure developed in all feeder cattle trade with extended trading limits seen in all contracts through October 2020. The fact that live cattle futures were unable to show any sign of life has created increased weakness through the cattle complex that may continue through the end of the week or longer.April feeders closed $6.75 lower at $110.67, May feeders closed $6.75 lower at $111.65 and August feeders closed $6.75 lower at $117.65.The CME feeder cattle index 4/1/2020: not available at this time.
LEAN HOGS:
Lean hog contracts follow suit and close the day limit lower throughout the market. April lean hogs closed $4.50 lower at $44.70, June lean hogs closed $4.50 lower at $52.82 and July lean hogs closed $4.50 lower at $57.22. Pork cutouts totaled loads 350.91 with 309.65 loads of pork cuts and 41.26 loads of trim. Pork cutout values: down $2.84, $59.21. Thursday's slaughter is estimated at 488,000 head, 11,000 head less than a week ago and 18,000 head more than a year ago.The CME lean hog index 3/31/2020: down $1.38, $63.08.
FRIDAY'S CASH HOG CALL: Lower. Given the intense pressure in futures and wholesale pork prices, cash bids are expected to remain lower going into the end of the week and weekend.
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