GENERAL COMMENTS:
It's been a downward spiral for the livestock futures Thursday as the cattle contracts wait patiently to see how the cash cattle market is going to pan out and the lean hog market is feeling pressured from the expiring April contract and the weaker export report. June live cattle are down $1.08 at $118.975, May feeder cattle are down $1.65 at $143.775, June lean hogs are down $3.00 at $104.7, May corn is down 5 1/4 cents per bushel and May soybean meal is up $3.40. The Dow Jones Industrial Average is up 276.65 points and NASDAQ is up 143.97 points.
LIVE CATTLE:
As feedlots look at a sixth consecutive day in a row of weaker trade, they look at the cash cattle market and know if there's one place the market is going to shoot them some positivity this week it's going to be in the cash market. That's not to say moving the needle in the cash cattle market is going to be easy as packers would obviously like to see prices trade at steady levels. But if feedlots can rally together and demand higher prices amid the higher boxed beef values, there's a good chance at least $1.00 if not $2.00 higher can be paid. April live cattle are down $1.15 at $120.95, June live cattle are down $1.05 at $119.02 and August live cattle are down $1.02 at $119.20. There's been some light trade in Texas at $120 and in Kansas a few head have sold at $121, which is $0.50 higher than last week. Bids of $122 have been placed on cattle in Iowa and bids of $196 are being offered in Nebraska.
Beef net sales of 15,700 metric tons (mt) reported for 2021 were down 14% from the previous week and 23% from the prior 4-week average. The three largest buyers were Japan (6,300 mt), China (3,300 mt) and South Korea (2,900 mt).
Boxed beef prices are higher: choice up $3.92 ($276.83) and select up $1.56 ($268.87) with a movement of 54 loads (23.79 loads of choice, 5.46 loads of select, 4.77 loads of trim and 19.86 loads of ground beef).
FEEDER CATTLE:
As the corn market takes a breather from rallying extensively the last two days, the feeder cattle contracts sit anxiously waiting to see what the cash cattle market does. If cash cattle can sell higher, then there may be enough supportive momentum in the complex to rally the feeder cattle higher. But at the noon hour the cash cattle market has only been meekly tested and traders want to see more confidence in the markets before they dive into higher prices. April feeders are down $0.95 at $140.20, May feeders are down $1.42 at $144.00 and August feeders are down $1.35 at $155.47.
LEAN HOGS:
Lean hog futures are feeling a little bent out of shape after Thursday's weaker export report, but the market still has strong support from both cash prices and the pork cutouts. The choppy volatile trade is nerve-wracking to watch, but given the high price point at which the complex is trading and given just how tight supplies are, we need to expect some volatility. June lean hogs are down $3.00 at $104.70, July lean hogs are down $3.00 at $102.37 and August lean hogs are down $2.75 at $98.05. Watching slaughter speeds will be important as we move into the afternoon.
Pork net sales of 17,200 mt for 2021 -- a marketing year low -- were down 48% from the previous week and 60% from the prior 4-week average. The three largest buyers were Mexico (7,800 mt), Japan (4,300 mt) and South Korea (1,300 mt).
The projected CME Lean Hog Index for 4/14/2021 is up $0.34 at $103.03, and the actual index for 4/13/2021 is up $0.32 at $102.69. Hog prices are higher on the National Direct Morning Hog Report, up $1.42 with a weighted average of $101.16, ranging from $99.96 to $105.00 on 3,730 head and a five-day rolling average of $99.79. Pork cutouts total 162.49 loads with 138.75 loads of pork cuts and 23.74 loads of trim. Pork cutout values: up $4.83, $114.92.
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