GENERAL COMMENTS:
It's been a lackluster day for the livestock complex as none of the markets really want to commit to anything. The biggest moves have been seen throughout the feeder cattle market as the contracts trade mildly higher amid weaker corn prices. However, the live cattle and lean hog contracts are hesitant to do much of anything. December corn is down 1 cent per bushel and December soybean meal is down $3.00. The Dow Jones Industrial Average is up 6.68 points and NASDAQ is down 105.10 points.
LIVE CATTLE
The live cattle contracts were trading higher earlier Thursday as the market traded higher, but the resistance at $122 was too much to bear at this point. If boxed beef prices were trading steady to even somewhat higher, or if the market had moved a significant volume of cash cattle for steady to higher prices, than the market would be in a different position, but unfortunately that's not the case in either instances. August live cattle are down $0.17 at $121.07, October live cattle are down $0.25 at $126.52 and December live cattle are down $0.25 at $131.67. The cash cattle market has been illusive thus far in Thursday's trade as packers are slow to renew their bids. The only bid that's on the table right now is that of $124 in Nebraska, but otherwise the market is idle. There should be some more cattle that trade before the week's end but given that packers have secured supplies, they won't have to jump wildly into this week's cash market.
Beef net sales of 9,300 mt reported for 2021 were down 61% from the previous week and 44% from the prior four-week average. The three largest buyers were Japan (3,000 mt), Mexico (1,800 mt) and China (1,600 mt).
Boxed beef prices are mixed: choice down $0.65 ($272.23) and select up $0.38 ($254.13) with a movement of 71 loads (36.22 loads of choice, 18.79 loads of select, 8.79 loads of trim and 7.31 loads of ground beef).
FEEDER CATTLE
After closing lower Wednesday afternoon amid a slightly higher corn market, the feeder cattle contracts are back to rallying come Thursday as the corn market is trading mildly lower and there's support stemming from the live cattle market. August feeders are up $0.50 at $157.40, September feeders are up $0.27 at $159.50 and October feeders are up $0.40 at $161.62. Given the constant game of cat and mouse that the corn and feeder cattle contracts like to play, it's incredibly helpful when the market's able to muster support from another source other than the corn market's fate. Although there haven't been any cattle trade at these levels yet, it's encouraging to see higher bids being offered for cash cattle in Nebraska as packers have now offered $124 live.
LEAN HOGS
Thursday's pukey export report didn't bring any accolades to the lean hog market and is partially to blame for the pressure seen in the market's nearby contract. August lean hog are down $0.77 at $104.32, October lean hogs are up $0.17 at $89.45 and December lean hogs re up $0.40 at $82.55. The market ran an impressive rally earlier in the week, but upon seeing a slightly lower pork cutout Wednesday afternoon, and now seeing a less-than-desirable export report, the soon to be spot contract of August is under some pressure. Meanwhile, the deferred contracts are trending modestly higher as the market expects limited numbers of market ready hogs to be a common reality throughout at least the end of the year.
Pork net sales of 10,600 mt reported for 2021 were down 76% from the previous week and 68% from the prior four-week average. The three largest buyers were Mexico (5,300 mt), Japan (3,100 mt) and Honduras (900 mt).
The projected CMS Lean Hog Index for July 14 is up $0.34 at $111.34, and the actual index for July 13 is up $0.33 at $111.00
Hog prices are lower on the National Direct Morning Hog Report, down $3.99 with a weighted average of $108.87, ranging from $106.00 to $117.00 on 3.551 head and a five-day rolling average of 109.66. Pork cutouts total 170.43 loads with 160.30 loads of pork cuts and 10.13 loads of trim. Pork cutout values: up $2.07, $120.76.
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