GENERAL COMMENTS:
It was a positive day for the lean hog market once again as the futures complex closed higher amid a slightly lower close in pork cutout value. Looking to Thursday's trade, both the cattle and hog markets are anxious to see the week's export report and hope that it can share some positive news. Hog prices closed lower on the National Direct Afternoon Hog Report, down $0.20 with a weighted average of $101.35 on 12,530 head. May corn is up 14 cents per bushel and May soybean meal is up $3.20. The Dow Jones Industrial Average is up 53.62 points and NASDAQ is down 138.26 points.
LIVE CATTLE:
The live cattle contracts continued to trade slightly lower throughout the day, not seeming to find interested traders at this point in the week. With boxed beef prices closing higher and with cash cattle prices expected to be fully higher come Thursday, traders may have a different attitude about the market after they see some more positive developments support the marketplace. April live cattle closed $0.30 lower at $122.10, June live cattle closed $0.87 lower at $120.05 and August live cattle closed $0.72 lower at $120.17. The day came and went without any substantial cash cattle trade developing -- packers were quiet following the online auction and it's looking like feedlots are going to stick to their guns and demand higher prices again this week. There was a small handful of cattle traded in the South for $121 but not enough to say that's where the market will trade this week. With boxed beef prices closing higher, they undoubtedly have every right to ask for more money. Wednesday's slaughter is estimated at 115,000 head, 5,000 head less than a week ago and 25,000 head more than a year ago.
Boxed beef prices closed higher: choice up $2.80 ($272.91) and select up $0.77 ($267.31) with a movement of 108 loads (57.23 loads of choice, 14.92 loads of select, 21.67 loads of trim and 14.51 loads of ground beef).
THURSDAY'S CASH CATTLE CALL: $2.00 higher. Feedlots have waited a long, long time to see the cattle market rally and they by no means are wanting to let this week's opportunity to rally the market come and pass them by. Showlists may be somewhat higher than they were a week ago, but supplies are still tight in Nebraska, and with beef demand continuing to be strong, they should be able to move the market beyond steady.
FEEDER CATTLE:
The feeder cattle contracts didn't stand much of a chance at trading higher as the nearby corn contracts rallied $0.10 to $0.14 higher. April feeder cattle closed $1.30 lower at $141.15, May feeder cattle closed $1.90 lower at $145.42 and August feeders closed $1.45 lower at $156.70.
It's likely that this week's cash cattle trade starts to attract some interest come Thursday and if corn prices don't trade sharply higher, the feeder cattle contracts may be able to rally off their momentum. At Winter Livestock Auction in Dodge City, Kansas, compared to last week, feeder steers weighing 400 to 1,000 pounds sold $4.00 to $8.00 lower. Feeder heifers weighing 400 to 925 pounds also sold $4.00 to $8.00 lower. Demand was moderate throughout the sale but not as strong as last week. Slaughter cows sold $2.00 to $4.00 lower and slaughter bulls sold $2.00 to $3.00 higher. The CME Feeder Cattle Index for April 13: down $0.10, $143.56.
LEAN HOGS:
The maintenance that is needing tended to in pork plants is putting a damper on this week's overall slaughter volume, as both Monday's and Tuesday's slaughter speeds have been revised lower and Wednesday's slaughter was stated lower from the get-go. Slower chain speeds never come as a positive gesture to producers, but packers will most certainly appreciate this opportunity to continue to buy in the cash market but not have to bump prices higher. Looking to Thursday's trade, producers are hopeful that Thursday's export report will be fruitful and will be another positive boost to the market. June lean hogs closed $1.52 higher at $107.70, July lean hogs closed $1.05 higher at $105.37 and August lean hogs closed $0.52 higher at $100.80. Pork cutouts totaled 324.44 loads with 284.45 loads of pork cuts and 39.99 loads of trim. Pork cutout values: down $2.40, $110.09. Wednesday's slaughter is estimated at 480,000 head, 14,000 head less than a week ago and 45,000 head more than a year ago. Tuesday's hog slaughter was revised to 484,000 head. The CME Lean Hog Index for April 12: up $0.49, $102.38.
THURSDAY'S CASH HOG CALL: Steady to somewhat lower. With production running at a slightly lower pace, packers may take this opportunity to continue to buy a large number of hogs in the cash market but not necessarily move prices higher as time gives them some opportunity.
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