GENERAL COMMENTS:
Cattle contracts trended higher through most of the day, but near closing the complex sank lower. Meanwhile, the lean hog complex didn't bat an eye at how the cattle contracts were trading as cash prices remained elevated through closing and the board held onto its strength through the end of the day. Hog prices closed $0.14 higher with a weighted average of $28.45 on 10,406 head. September corn is up 12 3/4 cents per bushel and July soybean meal is up $5.80. The Dow Jones Industrial Average is up 217.08 points and NASDAQ is up 184.62 points.
LIVE CATTLE:
As the June contract expired and attention completely rolls to August and October for nearby contracts, it's painful yet again to see where fat cattle are trading. Earlier Tuesday, the board couldn't seem to care less what the bearish fundamentals were and traded significantly higher. As time progressed, reality sunk in and contracts closed modestly lower. August live cattle closed $0.20 lower at $96.27, October live cattle closed $0.32 lower at $99.72 and December live cattle closed $0.12 lower at $103.65. There was another round of light trade in the North with cattle selling from $148 to $155, already $7.00 lower than last week's weighted average in Nebraska, all while the South has yet to trade cattle. Tuesday's slaughter is estimated at 121,000 head, 1,000 head above a week ago and 2,000 head less than a year ago.
Boxed beef prices closed lower: choice down $1.39 ($206.97) and select down $0.81 ($199.90) with a movement of 174 loads (94.26 loads of choice, 26.20 loads of select, 7.28 loads of trim and 45.95 loads of ground beef).
WEDNESDAY'S CASH CATTLE CALL: Steady to lower. Seeing cash prices weaken upwards of $7.00 in only the first two trading days of the week is brutally painful for the cash market. The rest of the week will trade either steady to lower keeping in the same trend.
FEEDER CATTLE:
Feeder cattle contracts were ambitious early in the day, but as time progressed, the complex lost its momentum and closed lower alongside the live cattle contracts. August feeders closed $0.65 at $132.85, September feeders closed $0.90 lower at $133.37 and October feeders closed $1.02 lower at $134.10. At Joplin Regional Stockyards in Carthage, Missouri, compared to last week, steer calves sold steady, while heifer calves sold steady to $3.00 higher. Meanwhile, yearling steers sold steady to $3.00 strong and yearling heifers were considered steady. Demand was good especially given the big run, upwards of 10,786 head sold. Come this Thursday, July 2, the auction barn will host the Big Bang Sale, which is anticipated to display another phenomenal offering, and feeder cattle prices could be as good as last week's specialty sales were. The CME feeder cattle index 6/29/2020: down $0.26, $129.42.
LEAN HOGS:
The lean hog complex was aggressive in its rally throughout the day, and with cash prices even trading higher, the market saw an opportunity to catch a jump forward. August lean hogs closed $0.57 higher at $49.02, October lean hogs closed $1.92 higher at $49.35 and December lean hogs closed $1.82 higher at $51.72. Pork cutouts total 439.50 loads with 388.03 loads of pork cuts and 51.46 loads of trim. Pork cutout values: down $2.09, $63.12. Tuesday's slaughter is estimated at 469,000 head, 12,000 head more than a week ago and 11,000 head less than a year ago. The CME lean hog index 6/26/2020: unchanged, $45.23.
WEDNESDAY'S CASH HOG CALL: Steady. Packers could pay the same price that they did Tuesday for hogs later in the week, given that it wasn't an astronomical jump. With the shortened week, they may need to buy a little more aggressively to cover for the weekend.
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