GENERAL COMMENTS:
It was a relatively quiet day for the livestock complex with both the lean hog and live cattle contracts seeing modest support carry the contracts higher into the day's close, while the feeder cattle complex continued to sway lower as corn prices kept rallying. Hog prices closed lower on the National Direct Afternoon Hog Report, down $0.51 with a weighted average of $116.42 on 6,533 head. May corn is up 6 1/4 cents per bushel and May soybean meal is up $3.40. The Dow Jones Industrial Average is up 318.19 points and NASDAQ is up 50.42 points.
LIVE CATTLE:
The live cattle contracts managed to close fully higher and Thursday's boxed beef prices continued to soar, but the cash cattle market neglected to see any more bids renewed, and even more depressing, Thursday's slaughter is only estimated at a sorry 115,000 head. Absorbing the stark difference in the live cattle market right now is a big job to manage and it nearly makes your head spin right off your shoulders. Boxed beef prices continue to scale higher and higher as consumers are faced with short supplies amid the nation's prime grilling season. All while feedlots have cattle to sell, and packers could (keyword there being "could") run faster chain speeds -- but instead feedlots are left without bids and consumers are faced with higher beef prices once again.
June live cattle closed $1.05 higher at $115.47, August live cattle closed $0.75 higher at $118.47 and October live cattle closed $0.37 higher at $123.47. Thursday's slaughter is estimated at 115,000 head, 4,000 head less than a week ago.
Beef net sales of 16,900 mt reported for 2021 were down 28% from the previous week and 18% from the prior four-week average. The three primary buyers were Japan (4,600 mt), Mexico (3,000 mt) and Taiwan (2,900 mt).
Thursday's actual slaughter data share that for the week ending April 24, both steer and heifer carcass weights saw decreases. Steers averaged 896 pounds (down 2 pounds from the previous week) and heifers averaged 825 pounds (down 12 pounds from the previous week).
Boxed beef prices closed higher: choice up $1.59 ($306.37) and select up $3.18 ($289.36) with a movement of 100 loads (64.71 loads of choice, 16.69 loads of select, 3.98 loads of trim and 14.45 loads of ground beef).
FRIDAY'S CASH CATTLE CALL: Steady. It's most likely that Friday won't see much for cash cattle trade as it's looking like the week's business is essentially done.
FEEDER CATTLE:
The $0.06 to $0.10 rally in the nearby corn contracts didn't allow for a kind closes in the feeder cattle contracts Thursday afternoon. May feeders closed $1.00 lower at $130.47, August feeders closed $1.82 lower at $143.40 and September feeders closed $1.92 lower at $145.55. All in all, Thursday's market once again fell victim to high corn prices and depressed fat cattle prices, which is an ugly, ugly reality for the feeder cattle market to stomach. At Mitchell Livestock Auction in Mitchell, South Dakota, compared to last week, there were very few light steers for sale. Feeder steers weighing 800 to 850 pounds sold steady, and lower undertones were seen on steers weighing 850 pounds and up. There was an unevenly steady undertone on heifers up to 850 pounds, while heifers weighing 850 to 950 pounds sold $1.00 to $3.00 lower. The CME Feeder Cattle Index for May 5: down $0.99, $131.56.
LEAN HOGS:
Truthfully, I didn't think the lean hog contracts would close higher Thursday afternoon, as the market has had a full speed ahead attitude this week, so it seemed logical that traders may want to let the market trade steady before taking prices any higher. However, the lean hog market decided to do what it has recently become quite accustomed to -- and that's trading higher. June lean hogs closed $0.05 higher at $114.47, July lean hogs closed $0.17 higher at $114.65 and August lean hogs closed $0.12 higher at $109.92. Thursday's pork cutout value closed higher with nearly every cut seeing $2.00 advancements, other than the picnic ham, which closed $2.50 lower and the rib, which only saw an advancement of $0.58 Thursday afternoon. Pork cutouts totaled 215.77 loads with 183.75 loads of pork cuts and 32.02 loads of trim. Pork cutout values: up $1.95, $113.86. Thursday's slaughter is estimated at 481,000 head, steady with a week ago. The CME Lean Hog Index for May 4: up $0.52, $107.89.
Pork net sales of 48,200 mt reported for 2021 were up 36% from the previous week and up noticeably from the prior four-week average. The three primary buyers were Mexico (19,400 mt), China (15,000 mt) and Japan (4,700 mt).
Thursday's actual slaughter data shared that for the week ending May 24, live carcass weights fell by 1 pound to average 290 pounds and dressed carcass weights remained stead at 217 pounds.
FRIDAY'S CASH HOG CALL: Steady to somewhat lower. As packers look to the weekend, they may back off on their cash hog buying sprees and let the weekend pass before jumping wildly into the market again.
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