GENERAL COMMENTS:
The day came and went without a whole lot of new developments affecting the livestock complex. The lean hog market was able to rally support and saw gains throughout both the cash market and in the day's cutout value, but the cattle contracts weren't as fortunate. Hog prices closed higher on the National Direct Afternoon Hog Report, up $1.01 with a weighted average of $101.55 on 9,470 head. May corn is up 11 cents per bushel and May soybean meal is down $6.90. The Dow Jones Industrial Average is down 68.13 points and NASDAQ is up 146.11 points.
LIVE CATTLE:
The live cattle market had a dreary day as the future contracts traded lower and boxed beef prices closed mixed. April live cattle closed $0.32 lower at $122.40, June live cattle closed $1.17 lower at $120.92 and August live cattle closed $1.05 lower at $120.90. The market's weaker trade doesn't come as a grappling surprise as traders are curious as to how this week's cash cattle market is going to pan out and need assurance that the market is indeed going to strengthen before they push the futures market higher. Will it be steady? Will it be $1.00 to $2.00 higher? Or will it come crashing into the week and shock us all at $4.00 higher? Time will certainly tell, but given that boxed beef prices are trading steady, $1.00 to $2.00 higher is the best guess as packers still need cattle but their willingness to throw more coin at the market is going to be less fun for them given the weaker choice cut prices. Tuesday's slaughter is estimated at 116,000 head, 4,000 head less than a week ago and 21,000 head more than a year ago. The Texas Cash Pool sold 689 head at $121.51, other packers offered bids of $119.11 and $120.55.
Boxed beef prices closed mixed: choice down $1.30 ($270.11) and select up $0.38 ($266.54) with a movement of 125 loads (74.53 loads of choice, 16.46 loads of select, 8.93 loads of trim and 25.52 loads of ground beef).
WEDNESDAY'S CASH CATTLE CALL: Higher. Packers are most likely going to offer bids that are steady to see if any feedlots are growing anxious. But if feedlots are able to let time favor their position, there's possibly more money to be had at the later part of the week, if feedlots can turn down packers' early bids.
FEEDER CATTLE:
The feeder cattle contracts sat through a long day of pressure that seemed to linger over the complex throughout the day. April feeders closed $2.05 lower at $142.45, May feeders closed $2.37 lower at $147.32 and August feeders closed $2.42 lower at $158.15. Without any support stemming from the live cattle contracts, and with added pressure building from the rallying corn prices, the feeder cattle contracts really had no other option but to trade lower. If later in the week corn prices can stabilize and cash cattle can give the live cattle market a gust of support, then the feeder cattle contracts may stand a chance at trading higher again. At Oklahoma National Stockyards in Oklahoma City, Oklahoma, compared to last week, feeder steers sold steady to $1.00 higher, and those weighing over 900 pounds sold upward of $3.00 higher. Feeder heifers traded steady to $2.00 higher. Demand was strong throughout the sale, especially for feeder cattle. Steer calves traded $1.00 to $2.00 lower and heifer calves traded unevenly steady. The CME Feeder Cattle Index for April 12: up $0.30, $143.66.
LEAN HOGS:
The lean hog market was relieved to see pork cutout values close higher and for the day's cash hog market to close notably stronger. We thoroughly understand that given the tight supplies in the hog market that price swings throughout pork cutout values are anticipated, but a day that closes higher is always more warmly accepted than that of a day that closes lower. Monday's cash hog trade was perplexing as volumes were noticeably light but come Tuesday, the cash hog market acted more like its recent self and traded over $1.00 higher on nearly 10,000 head. June lean hogs closed $0.02 higher at $106.17, July lean hogs closed $0.15 lower at $104.32 and August lean hogs closed $0.12 lower at $100.27. Pork cutouts totaled 375.27 loads with 340.80 loads of pork cuts and 34.47 loads of trim. Pork cutout values: up $2.39, $112.49. Tuesday's slaughter is estimated at 476,000 head, 6,000 head less than a week ago and 37,000 head more than a year ago. Monday's hog slaughter was revised to 488,000 head. The CME Lean Hog Index for April 9: up $0.52, $101.89.
WEDNESDAY'S CASH HOG CALL: Steady to somewhat higher. Seeing that packers were aggressive in Tuesday's cash hog market is a good supportive sign for Wednesday's cash hog market, but it will be interesting to see if Tuesday's slaughter is revised as Monday's slaughter was.
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