GENERAL COMMENTS:
It wasn't the day to be lethargically drinking midday coffee, as cash cattle trade jumped higher, cattle contracts closed mostly limit higher and the lean hog complex was able to close moderately higher as well. Hog prices closed higher on the National Direct Afternoon Hog Report, up $0.04 with a weighted average of $36.40 on 4,735 head sold. July corn is down 2 3/4 cents per bushel and July soybean meal is down $1.30. The Dow Jones Industrial Average is down 218.45 points and NASDAQ is up 45.27 points.
LIVE CATTLE:
The cattle market was fiery come Wednesday afternoon. Early Wednesday, it looked like it was going to be just another day -- bids and asking prices had yet to surface, which is odd but not life changing, and the board had opened somewhat lower but was starting to warm up to the idea of trading higher. Midmorning the Fed Cattle Exchange hosted their sale and nothing really transpired but a couple of pens that sold for mostly $95.00. But shortly after the noon hour, the countryside lit up and cash prices started to spark. A jump in prices hit the South as deals were offered at $110, compared to last week's weighted averages that is $10 higher in Texas and $9 higher in KS. It's looking like business has been completed by one major packer. There was also some 100% blacks in Iowa at $180 dressed set for two-week delivery. So far, the North has been mostly quiet, with more business expected to develop later in the week.
The board closed mostly limit higher except in some deferred contracts. June live cattle closed $3.00 higher at $89.47, August live cattle closed $3.00 higher at $95.45 and October live cattle closed $3.00 higher at $99.52. Wednesday's slaughter is estimated at 82,000 head, 10,000 head more than a week ago and 37,000 head less than a year ago.
Boxed beef prices closed higher: choice up $20.19 ($449.18) and select up $21.25 ($431.96) with a movement of 110 loads (54.58 loads of choice, 16.84 loads of select, 17.56 loads of trim and 20.83 loads of ground beef).
THRUSDAY'S CASH CATTLE CALL: Steady in the South; slightly higher in the North. Seeing that the South already jumped $10.00 for the week, it would be eye-opening for another packer to come in and up the price even more. There is room for cattle to trade higher in the North though.
FEEDER CATTLE
Feeder cattle contracts jumped sharply higher after the noon whistle and closed mostly limit higher. As the live cattle market saw strengthening support in the cash market and on the board, feeder cattle contracts saw the green light to trade higher. May feeders closed $4.50 higher at $124.10, September feeders closed $4.50 higher at $133.95 and October feeders closed $4.45 higher at $135.07. At Winter Livestock in Dodge City, Kansas, compared to last week, feeder steers sold $2.00 to $4.00 higher, but steer calves weren't well tested to develop an accurate market. Heifers weren't well tested this week either, however, a lower undertone on heifer calves was noted while a higher undertone on yearling heifers developed. The CME feeder cattle index 5/5/2020: down $0.09, $119.50.
LEAN HOGS:
The lean hog market didn't close limit higher like most of the cattle contracts, but the complex most certainly closed the day higher and on an optimistic note as both the board and cash market closed higher. June lean hogs closed $1.30 higher at $65.57, July lean hogs closed $0.87 higher at $63.80 and August lean hogs closed $0.50 higher at $63.17. Pork cutouts total 313.88 loads with 287.40 loads of pork cuts and 26.48 loads of trim. Pork cutout values: up $1.48, $115.06. Wednesday's slaughter is estimated at 312,000 head, 46,000 head more than a week ago and 159,000 head less than year ago. The CME lean hog index 5/4/2020: up $0.56, $60.35.
THURSDAY'S CASH HOG CALL: Steady. On Tuesday it was estimated that the day's slaughter was 20,000 head more than last weeks and Wednesday's slaughter is estimated to be upwards of 46,000 head more than a week ago. Seeing that slaughter is slowly progressing is a fabulous sign; we just need more of it! Unfortunately, with the built-up supply, it won't most likely affect the cash market as there are too many hogs sitting throughout the countryside.
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