GENERAL COMMENTS:
It was a good day for the livestock complex, but a considerably good day for the live cattle futures as they closed fully higher. Feedlots are looking at the strength that the live cattle contracts are pushing and they're hopeful cash cattle prices can trend higher too. Hog prices closed higher on the Daily Direct Afternoon Hog Report, up $4.67 with a weighted average price of $106.87 on 7,711 head. May corn is up 9 3/4 cents per bushel and May soybean meal is down $0.30. The Dow Jones Industrial Average is up 599.10 points and NASDAQ is up 367.40 points.
LIVE CATTLE:
While the other livestock contracts faced some pressure, the live cattle contracts pushed onward and kept with Monday's quest for a stronger market. April live cattle closed $0.52 higher at $140.85, June live cattle closed $1.10 higher at $136.80 and August live cattle closed $0.62 higher at $137.30. With the contracts still trading lower than both the 100- and 40-day moving averages, traders saw Tuesday's market as an opportunity to scale the contracts higher without running into much risk. This bodes well for the cash cattle market as feedlots are hopeful this strength will help them attain stronger prices this week. There's yet to be any real cash trade to speak of, but it's likely bids begin to develop by Wednesday. Asking prices in the South are noted at $142.
Tuesday's slaughter is estimated at 125,000 head -- steady with a week ago and 4,000 head more than a year ago.
Boxed beef prices closed mixed: choice up $2.39 ($257.90) and select down $1.10 ($248.84) with a movement of 135 loads (67.33 loads of choice, 18.45 loads of select, 12.16 loads of trim and 37.46 load of ground beef).
WEDNESDAY'S CASH CATTLE CALL: Higher. With boxed beef prices showing supportive signs of bottoming, it's likely feedlots are able to keep the market steady, if not even gain $1.00. Packers aren't going to freely give feedlots more money, but if beef prices continue to trend higher, they'll want the product in front of consumers in order to capture the boxed beef dollars.
FEEDER CATTLE:
The corn and soybean markets closed lower, but wheat continued to push higher through Tuesday's close. Thankfully, the mixed tones stemming from the grain complex allowed for some of the feeder cattle contracts to still close higher. The summer months of May through October were pressured and ended up closing lower, which could partly be because those are also the months where live cattle will likely see the most pressure ahead of a rally in the latter part of the third quarter and likely into the fourth quarter. March feeders closed $0.40 higher at $156.35, April feeders closed $0.20 higher at $162.60 and May feeders closed $0.15 lower at $167.30. At Oklahoma National Stockyards in Oklahoma City, Oklahoma, compared to last week on a run of 8,812 head feeder steers and heifers traded steady to $3.00 higher. Steer and heifer calves traded unevenly steady. Demand was good for feeder cattle and demand was noted as mixed to good for calves. The CME Feeder Cattle Index 3/14/2022: up $0.50, $152.81.
LEAN HOGS:
The lean hog complex closed mixed with its nearby contracts higher while the deferred months ventured lower. Looking at the market's trajectory in terms of supplies of market-ready hogs, part of the deferred months pressure could be stemming from the fact that hog supplies could be more ample in the latter part of the third quarter of 2022 and into the fourth quarter. Nevertheless, the market was satisfied with consumer demand as pork cutout values closed higher and packers were again aggressive in the cash hog market. Ham prices saw a notable jump of $12.39 to now average $78.10. April lean hogs closed $0.20 higher at $102.40, June lean hogs closed $0.72 higher at $120.07 and July lean hogs closed $0.77 higher at $119.15. Pork cutouts totaled 375.34 loads with 326.53 loads of pork cuts and 48.82 loads of trim. Pork cutout values: up $1.29, $104.48. Tuesday's slaughter is estimated at 479,000 head -- 1,000 head less than a week ago and 15,000 head less than a year ago. Monday's hog slaughter was revised to 466,000 head -- 13,000 head less than what was originally stated. The CME Lean Hog Index 3/11/2022: up $0.09, $100.85.
WEDNEDAY'S CASH HOG CALL: Higher. With supplies of hogs continuing to remain thin and three packing plants now being able to increase their chain speeds by the month's end, demand for hogs will likely grow.
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