GENERAL COMMENTS:
The export reports of the day were strong for both pork and beef sales, but the live cattle market isn't able to rally amid its strong unveiling. Meanwhile, the lean hog market is cherishing the opportunity to rally modestly ahead of the weekend as oppose to keeping with the lower trending, sideways chop. December corn is down 16 1/4 cents per bushel and December soybean meal is down $6.40. The Dow Jones Industrial Average is up 431.26 points and NASDAQ is up 118.16 points.
LIVE CATTLE
The live cattle market was given a bullish export report but that doesn't seem to be enough to overshine the dogma following a weaker cash cattle market and stout resistance on the board. August live cattle are down $0.40 at $118.87, October live cattle are down $0.52 at $124.92 and December live cattle are down $0.20 at $130.07. Seeing that half of Friday has already passed us by, it's very unlikely that the live cattle market's fate gets better before the week's end. With live cattle selling this week for mostly $119 to $120 ($1.00 to $2.00 softer than last week) and dressed cattle selling for mostly $197 to $198 (steady to $1.00 lower), the market sits frustrated that packers once again dodge having to fully support the market, waning prices lower. There's been no more action in cash cattle market Friday morning, and its most likely that the week's trade is done with.
Beef net sales of 23,700 mt reported for 2021 were up 96% from the previous week and 64% from the prior four-week average. The three largest buyers were South Korea (10,400 mt), Japan (5,800 mt) and China (2,700).
Boxed beef prices are lower: choice down $2.41 ($279.56) and select down $1.55 ($258.51) with a movement of 58 loads (25.66 loads of choice, 18.26 loads of select, 5.81 loads of trim and 8.54 loads of ground beef).
FEEDER CATTLE
The spot contract of August is trading mildly lower in Friday's afternoon trade, but the rest of the complex is trending modestly higher as the market has seen amble support from buyers in the countryside this past week. August feeders are down $0.05 at $157.27, September feeders are up $0.02 at $160.05 and October feeders are up $0.12 at $162.25. Obviously, the feeder cattle market would like to see stronger developments from both the live cattle and cash cattle markets, but at the same time, the market cannot deny how aggressive buyers have been to fill their orders this week, and a lower ascending corn market doesn't hurt their feelings either.
LEAN HOGS
The lean hog market is trading mixed into Friday's afternoon trade as the market savors the victory of a bullish export report. Understanding what's truly happening in China with their pork production is a maddening task, but when enough clues point to the same conclusion, the market gains confidence. The price of U.S. pork is incredibly high compared to other markets, so not seeing China have strong presence in the export market over the last month wasn't that peculiar. But more stories have broke that the nation continues to be challenged with Africa swine fever, which not only limits their pork production recovery plan, but also pushes them into buying brought. July lean hogs are up $0.37 at $110.47, August lean hogs are up $0.40 at $100.80 and October lean hogs are up $0.52 at $84.62.
Pork net sales 43,800 mt reported for 2021 were up 53% from the previous week and 65% from the prior four-week average. The three largest buyers were China (16,300 mt), Mexico (13,800 mt) and Japan (8,400 mt).
The projected CME Lean Hog Index for July 8 is down $0.03 at $109.74, and the actual index for July 7 is down $0.36 at $109.77. Hog prices are lower on the National Direct Morning Hog Report, down $2.92 with a weighted average of $106.45, ranging from $106.00 to $112.00 on 2,403 head and a five-day rolling average of $108.89. Pork cutouts total 149.68 loads with 125.22 loads of pork cuts and 24.46 loads of trim. Pork cutout values: up $1.51, $118.40.
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