GENERAL COMMENTS:
The livestock complex has done some flip-flopping since Tuesday as the feeder cattle and live cattle contracts are rallying while the lean hog complex wanes lower. The cash cattle market has seen some interest arise in the South, but packers are going to need to up their bids before feedlots get interested in talking seriously. May corn is down 5 1/2 cents per bushel and May soybean meal is down $7.80. The Dow Jones Industrial Average is up 604.34 points and NASDAQ is up 160.83 points.
LIVE CATTLE:
Live cattle futures are growing a backbone and trying like hell to trade higher, although the market is taking some stiff persuasion. This couldn't come at better timing as the cash cattle market could use the technical support. April live cattle are up $0.10 at $140.62, June live cattle are down $0.27 at $136.70 and August live cattle are up $0.02 at $137.10. We've been waiting for the boxed beef market to bottom and its looking like the market could be getting extremely close to doing so as the midday prices are mixed (choice lower but select higher). There are a few bids being offered in parts of Texas at $140, but with asking prices at $144 in the South, I'd hope that feedlots stick to their asking prices as opposed to letting packers win this week's quarrel. Feedlots know showlists favor their position and supplies of cattle are extremely current -- all of which bodes well for the cash cattle market to rally.
The Fed Cattle Exchange Auction on Wednesday listed a total of 1,950 head, of which 35 actually sold, none were scratched from the auction and 1,915 head were listed as unsold, as they did not meet the reserve prices, which ranged from $132 to $145. Opening prices ranged from $125 to $140, high bids ranged from $132 to $142. The state-by-state breakdown looks like this: Texas 1,608 total head, all of which went unsold; Kansas 192 total head, all of which went unsold; Iowa 115 total head, all of which went unsold; Colorado 35 total head, all of which sold at $132.
Boxed beef prices are mixed: choice down $1.05 ($255.63) and select up $0.58 ($252.10) with a movement of 82 loads (56.68 loads of choice, 10.07 loads of select, 6.38 loads of trim and 9.34 loads of ground beef).
FEEDER CATTLE:
Grain futures are retreating from their recent highs, which is boding well for the feeder cattle market. It will take some time before one can feel confident about where the grain complex's trajectory lies. That likely won't be known until the war with Ukraine and Russia ends. Ukraine is a big producer of grains and its welfare through this war directly affects our grain prices, which consequently affects feeder cattle prices as well. March feeders are up $1.47 at $157.75, April feeders are up $2.37 at $162.17 and May feeders are up $1.97 at $167.22.
LEAN HOGS:
As the cattle contracts enjoy mild gains, the lean hog complex is trending lower after trading higher throughout Tuesday's market. Pork cutout prices did close $4.08 lower by Tuesday's end, but there's a chance that Wednesday's afternoon value closes higher and gives the market some assurance that pork cutouts are still being supported. There's a lot that could be adding pressure to the lean hog complex -- market exhaustion after an incredible rally, Lent and overall chaos in the world thanks to Russia. Another thing we need to look for this afternoon is Wednesday's estimated slaughter. Monday's slaughter was revised lower to a scant 451,000 head and then Tuesday's slaughter was nearly bursting at 482,000 head. There's a chance Tuesday's slaughter was actually that big to make up for Monday's lack of production; but there's equally the chance that Tuesday's slaughter is revised lower as supplies of hogs are getting thinner and thinner. April lean hogs are down $0.92 at $105.27, June lean hogs are down $1.12 at $115.67 and July lean hogs are down $1.00 at $115.02.
The projected CME Lean Hog Index for 2/28/2022 is up $0.57 at $99.66, and the actual index for 2/25/2022 is up $0.69 at $99.09. Hog prices are higher on the National Direct Morning Hog Report, up $1.14 with a weighted average of $89.73, ranging from $88.00 to $103.00 on 3,270 head and a five-day rolling average of $88.23. Pork cutouts total 139.92 loads with 114.58 loads of pork cuts and 25.35 loads of trim. Pork cutout values: up $3.03, $111.22.
No comments:
Post a Comment