General Comments
Cattle contracts are gaining some strength in nearby contracts while the lean hog contracts drift lower. The cash market has yet to really test the waters, which is different from how the past couple of weeks have traded. July corn is down 5 1/2 cents per bushel and July soybean meal is down $1.80. The Dow Jones Industrial Average is down 246.38 points and NASDAQ is up 31.07 points.
LIVE CATTLE
Live cattle contracts have picked up their tempo and are trading fully higher into the noon hour. June live cattle are up $1.77 at $95.90, August live cattle are up $1.00 at $97.35 and October live cattle are up $0.95 at $100.32. There was extremely light trade that took place Monday, but so far Tuesday has been extremely quiet as bids and asking prices have yet to surface. Over the last couple of weeks packers have actively participated in the market each day and bought upwards of 100,000 head for the week. Seeing that this week isn't falling into the same trend leads to the question, just how aggressive packers will be this week?
Boxed beef prices are lower: choice down $5.29 ($249.29) and select down $2.27 ($228.85) with a movement of 124 loads (69.48 loads of choice, 24.28 loads of select, 3.82 loads of trim and 26.15 loads of ground beef).
FEEDER CATTLE
After seeing some support build in the nearby live cattle contracts, the feeder cattle contracts started to gingerly test the market and began to trade higher but have since extended even more and are trading near $1.00 higher through most of the complex. August feeders are up $0.77 at $133.85, September feeders are up $0.75 at $135.27 and October feeders are up $0.82 at $135.85. Even though the board closed lower Monday afternoon, sale barns were still able to sell feeders for steady to slightly higher prices. Seeing the green optimism on the board should leave Tuesday in the boat so long as cash cattle prices don't develop significantly lower throughout the day.
LEAN HOGS
Lean hog contracts started the day out trading higher but have since lost some of their steam and are trading lower. June lean hogs are down $0.37 at $48.20, July lean hogs are down $1.22 at $52.75 and August lean hogs are down $1.00 at $56.82. An exuberant supply and lower cash hog prices can weigh on the market significantly; but in order to get the market back to a healthy and current state, packers need to press through this backlog -- which thankfully they have been doing.
The projected lean hog index for 6/8/2020 is down $0.16 at $51.77 and the actual index for 6/5/2020 is down $1.42 at $51.93. Hog prices on the National Direct Morning Hog Report are down $0.67 with a weighted average of $30.14, ranging from $27.00 to $32.00 on 3,797 head and a five-day rolling average of $32.14. Pork cutouts total 276.03 loads with 258.96 loads of pork cuts and 17.06 loads of trim. Pork cutout values: down $0.44, $70.44.
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