GENERAL COMMENTS:
There's something to be said about limited supplies and stellar consumer demand, and the pork market is soaking up all the market has to offer while these prices last. The beef market would like to say the same thing, but unfortunately feedlots aren't seeing the same type of packer interest that the hog producers are. Hog prices closed higher on the National Direct Afternoon Hog Report, up $2.51 with a weighted average of $109.31 on 5,166 head. July corn is down 2 1/4 cents per bushel and July soybean meal is up $1.30. The Dow Jones Industrial Average is up 186.14 points and NASDAQ is up 190.18 points.
LIVE CATTLE:
The live cattle contracts had a lower trending day, but the market did see stronger boxed beef prices and a swift kill Monday afternoon. June live cattle closed $0.92 lower at $116.75, August live cattle closed $0.82 lower at $120.10 and October live cattle closed $0.77 lower at $124.27. Last week's impressive kill of 669,000 head was one to applaud, but in order for the market to really benefit, it needs to be seeing those type of processing speeds week in and week out. The cash cattle market had a typical Monday -- the market was mostly quiet, but a few bids were offered in Eastern Nebraska at $190. If the market follows the trend that's been established in the last couple of weeks, we could see some trade develop as early as Tuesday afternoon. Monday's slaughter is estimated at 119,000 head, 4,000 head more than a week ago. New showlists appear to be mixed, somewhat higher in Texas and Kansas, but lower in Nebraska and Colorado.
Last week's negotiated cash cattle traded totaled 82,209 head. Of that 71% (58,166 head) are committed for delivery in the new two upcoming weeks while the remaining 29% (24,043 head) are schedule for delivery in the following 15 to 30 days.
Boxed beef prices closed higher: choice up $2.66 ($327.83) and select up $1.08 ($303.39) with a movement of 99 loads (47.33 loads of choice, 22.19 loads of select, 23.93 loads of trim and 5.58 loads of ground beef).
TUESDAY'S CASH CATTLE CALL: Higher. The negative pull that the cash cattle market has to battle is the fact that packers have cattle already committed for this time. But with packers wanting to run faster processing speeds and boxed beef prices still trending higher, there's a lot of money to be made and they will surely be keen on making all that they can while consumers are hungry.
FEEDER CATTLE:
The feeder cattle market was the only livestock complex able to close with some higher trending contracts as the market capitalized on the fact that the corn market had a lower trending day. August feeders closed $0.42 higher at $154.12, September feeders closed $0.50 higher at $155.40 and October feeders closed $0.62 higher at $156.32. Thankfully the moisture that's been received over the last week has helped boost prices seen throughout sale-barns in the U.S. and areas that are accumulating a decent amount of moisture are seeing buyers come to their sales with more aggression. At Joplin Regional Stockyards at their midsession point, compared to last week, feeder steers were traded $3.00 to $6.00 higher and feeder heifers were trading $4.00 to $7.00 higher. The CME Feeder Cattle Index for May 21: up $0.46, $135.66.
LEAN HOGS:
In case you still weren't a believer, it's true -- hogs can fly, or maybe we should say pork cutouts can fly. Monday's afternoon close of $122.21 surpassed the 2020 top and comes to show just how tight supplies truly are. With pork prices climbing ever higher, the cash market shot higher and packers saw an opportunity to make another buck in meat sales, so Monday's slaughter levels were more aggressive as well. Meanwhile, the board didn't rally through Monday's close, but it wouldn't be surprising to see traders more friendly in their pork trade come Tuesday or Wednesday if strong demand continues. June lean hogs closed $0.87 lower at $113.35, July lean hogs closed $1.22 lower at $115.32 and August lean hogs closed $0.47 lower at $111.55. Pork cutouts totaled 226.95 loads with 194.13 loads of pork cuts and 32.81 loads of trim. Pork cutout values: up $1.35, $122.21. Monday's slaughter is estimated at 482,000 head. 4,000 head more than a week ago. The CME Lean Hog Index for May 20: down $0.01, $111.43.
TUESDAY'S CASH HOG CALL: Steady. Monday's cash hog market was aggressive as packers bought just over 5,000 head and for $2.51 more than what the market was trading for last Friday. There's a good chance that they come back and buy aggressively to chase the market's high rewarding prices, but it all comes down to whether or not demand will hold.
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