GENERAL COMMENTS:
It surely wasn't the week any livestock enthusiast had hoped for as the live cattle, feeder cattle and lean hog futures were all pressured multiple times to trade lower. Hog prices closed higher on the National Direct Afternoon Hog Report, up $1.71 with a weighted average of $104.49 on 9,185 head. May corn is down 4 1/2 cents per bushel and July soybean meal is down $0.10. The Dow Jones Industrial Average is up 164.68 points and NASDAQ is up 13.58 points.
From Friday to Friday livestock futures scored the following changes:
April live cattle down $2.57, June live cattle down $3.40; April feeder cattle down $5.13, May feeder cattle down $5.90; June lean hogs down $7.25, July lean hogs down $7.10.
LIVE CATTLE:
And just like that, Friday closes and the cattle contracts have endured seven consecutive days of weaker trade. April live cattle closed $0.75 lower at $120.85, June live cattle closed $0.47 lower at $119.17 and August live cattle closed $0.55 lower at $119.15. One of the market's biggest discouraging facets this past week was the steady to $1.00 higher cash cattle trade. Feedlots were hoping to be able to move the market at least $2.00 stronger this week but the burdensome factors of high corn prices and a premium some were able to get off the board's basis made it hard to summon higher cash cattle prices. Watching for Monday's official reports will be critical as this week's movement seems quite light. Live cattle traded in the South for $119 to $121, mostly $120 to $121 which is steady to $1.00 higher than last week. Dressed cattle in the North traded for $193 to $196, mostly from $195 to $196 which is steady to $1.00 higher than last week's average.
Friday's slaughter is estimated 113,000 head -- 2,000 head more than a week ago and 27,000 head more than a year ago. Saturday's kill is projected to be around 70,000 head -- 4,000 head more than a week ago and 32,000 head more than a year ago.
Boxed beef prices averaged higher again throughout the week when compared to last week's prices. Choice cuts averaged $273.42 (up $7.34) and select cuts averaged $267.51 (up $10.66) with a total movement of cuts, grinds and trim totaling 538 loads.
Boxed beef prices closed mixed: choice down $0.57 ($276.05) and select up $0.67 ($269.10) with a movement of 88 loads (54.68 loads of choice, 10.12 loads of select, 10.75 loads of trim and 12.89 loads of ground beef).
MONDAY'S CASH CATTLE CALL: Steady. Packers are going to want to buy cattle for steady to cheaper money next week. Thankfully demand is still considerably strong for beef right now, which will keep packers having to participate in the cash market to some degree. But their willingness to support a higher cash market will be minimal.
FEEDER CATTLE:
It was a rough week for feeder cattle futures. The market received far less support that it needed from the cash cattle trade and the corn market showed no mercy as it just keeps climbing higher and higher. As we've chatted about before, high corn prices aren't necessarily a problem as long as they also beckon higher cattle prices. But problems arise when input prices are high and your output is low. One of my favorite pieces of market advice came from my grandpa who said, "You make your money the day you buy, not the day you sell." Feedlots seemed to hang onto that mindset this week. With cash cattle prices dancing around $120, feeders were too expensive for them to dive into and expect to make any money. Kansas's Weekly Cattle Auction Summary shared that compared to last week feeder steers weighing 500 to 700 pounds sold $6.00 to $8.00 lower; those weighing above 700 pounds sold $1.00 to $5.00 lower. Feeder heifers sold $3.00 to $7.00 lower. Slaughter cows sold $3.00 to $5.00 lower and slaughter bulls sold $2.00 lower. The CME Feeder Cattle Index 4/15/2021: down $0.62, $141.68.
LEAN HOGS:
That some contracts were allowed to trade into their expanded limits throughout Friday and the only contract to close $3.00 lower was the June lean hog contract is far better that what the day's close could have been. June lean hogs closed $3.00 lower at $101.70, July lean hogs closed $2.67 lower at $99.70 and August lean hogs closed $1.65 lower at $96.15. Packers continue to scrap amongst one another throughout the countryside for any and all hogs. With supplies being as tight as they are packing plants are going to lighter Saturday kill schedules as there simply aren't enough pigs around to justify a full-bore Saturday kill amid difficulties finding help and plant maintenance needing to be performed. Choppy, volatile trade is expected next week as supplies are tight, but consumer demand continues to be outstanding. Pork cutouts totaled 265.86 loads with 222.39 loads of pork cuts and 43.47 loads of trim. Pork cutout values: down $1.28, $112.09. Friday's slaughter is estimated at 468,000 head -- steady with a week ago and 63,000 head more than a year ago. Saturday's kill is projected to be around 75,000 head -- 109,000 head less than a week ago and 142,000 head less than a year ago. Thursday's hog slaughter was revised to 474,000 head. The CME Lean Hog Index 4/14/2021: up $0.33, $103.03.
MONDAY'S CASH HOG CALL: Steady to somewhat higher. Given that packers are having to work the countryside so vigorously to get the hogs they need, after a weekend off they are most likely going to hit Monday aggressively.
No comments:
Post a Comment