GENERAL COMMENTS:
It was a quiet day throughout the livestock complex as most traders peeled out of the marketplace early to enjoy an extra-long weekend. Looking ahead to next week's trade, the market could be slow to start Tuesday morning, but by Wednesday, the irregularities that holiday weeks bring should be well behind the market. Hog prices closed lower on the National Direct Afternoon Hog Report, down $1.18 with a weighted average of $108.21 on 3,915 head. December corn is down 9 1/4 cents per bushel, and December soybean meal is down $0.40. The Dow Jones Industrial Average is up 143.80 points, and the NASDAQ is up 113.85 points.
From Friday to Friday, livestock futures scored the following changes: August live cattle down $0.80, October live cattle down $0.33; August feeder cattle down $2.50, September feeder cattle down $1.82; July lean hogs up $6.70, August lean hogs up $0.45.
* The markets are closed on Monday, July 5, so DTN will resume all comments on Tuesday, July 6. Happy Fourth of July!
LIVE CATTLE:
The live cattle contracts couldn't find any last-minute support from traders before Friday's whistle blew. But even more disappointing was to see another day of thin movement of cash cattle trade this week. August live cattle closed $1.57 lower at $122.00, October live cattle closed $1.17 lower at $128.07 and December live cattle closed $0.42 lower at $132.77. Based on Friday's afternoon sales, the week's movement of cash cattle only totaled 60,537 head. Now, yes, on a holiday week, that's not terrible, but when last week's trade only amounted to a measly 48,965 head, the market was hoping to see better demand this week to make up for last week's disappointment. Looking to next week's trade, the market will see total kill numbers very similar to this week's estimates as Monday will be reduced significantly. With the Fourth of July landing on a Sunday this year, the market doesn't have just one week of holiday oddity to deal with, but rather two weeks where trade could be compromised. Packers could be enticed to run vigorous kill speeds next week, though, as retailers look to restock their coolers and replenish inventory.
Friday's slaughter is estimated at 113,000 head -- 3,000 head fewer than a week ago and 6,000 head more than a year ago. Saturday's kill is projected to be around 33,000 head. This week's total slaughter is estimated at 623,000 head -- 42,000 head more than the same week a year ago.
Boxed beef prices closed lower: choice down $2.21 ($285.44) and select down $2.52 ($264.41) with a movement of 103 loads (56.58 loads of choice, 16.35 loads of select, 8.07 loads of trim and 21.95 loads of ground beef). Throughout the week, choice cuts averaged $290.83 (down $21.84 from last week's average), and select cuts averaged $268.99 (down $8.80 from last week's average). The week's total movement of cuts, grinds and trim totaled 648 loads.
TUESDAY'S CASH CATTLE CALL: Higher. After two weeks of light cash cattle trade, the market should see more interest from packers.
FEEDER CATTLE:
The feeder cattle contracts jumped with joy and saw an opportunity in Friday's thin market as the corn complex waned lower once again. It was especially refreshing for the market to see the spot July contract trade lower even though its set to expire in less than two weeks. The other corn contracts are all trading below $6 a bushel, but the spot July contract is continuing to dance close to the $7 line. This past week was a quiet one for the feeder cattle market as traders were lackadaisical in their trade and most sale barns canceled their weekly sale to a take a midyear break. And without much action seen throughout the cash cattle market, the feeder cattle contacts twiddled their fingers. Next week's trade is likely to be slow early in the week, but from Wednesday on, the market should see strong participation as the holiday fully fades to the rearview mirror. August feeders closed $0.72 higher at $157.05, September feeders closed $0.35 higher at $159.42 and October feeders closed $0.40 higher at $161.47. The CME feeder cattle index 7/1/2021: down $0.35, $145.96.
LEAN HOGS:
The lean hog contracts rounded out the week mostly higher, except for the August and October 2021 contracts. July lean hogs closed $1.35 higher at $108.65, August lean hogs closed $0.07 lower at $100.22 and October lean hogs closed $0.17 lower at $84.70. The market could find some support next week as packers will need to procure hogs, and coolers will need replenished after the holiday festivities. Packers have slowed their processing levels as margins become less and less favorable, but gauging where they intend to run will become clearer next week as the market settles down into a normal schedule again. Pork cutouts totaled 252.94 loads with 225.27 loads of pork cuts and 27.67 loads of trim. Pork cutout values: down $0.44, $115.19. Friday's slaughter is estimated at 430,000 head -- 12,000 head fewer than a week ago and 252,000 head more than a year ago. Saturday's kill is projected to be around 15,000 head. This week's total slaughter is estimated at 2,282,000 head -- 243,000 head more than the same week a year ago. The CME lean hog index 6/30/2021: down $0.41, $111.77.
TUESDAY'S CASH HOG CALL: Higher. As the market dives into next week's trade coming off the hype of the long holiday weekend, one would assume that packers would be aggressive in their purchases as coolers need restocked.
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