GENERAL COMMENTS:
It was a tough close for the livestock complex as traders sent the contracts trailing lower and the cash markets saw little to no interest. Heading into next week's trade, all eyes will be on the contracts to see how much more downside lays within this move. Hog prices closed lower on the Daily Direct Afternoon Hog Report, down $2.43 with a weighted average of $100.14 on 4,367 head. June lean hogs are down $4.60 at $106.375, July corn is steady and July soybean meal is up $2.20. The Dow Jones Industrial Average is down 939.18 points.
From Friday to Friday livestock futures scored the following changes: April live cattle off $0.55, June live cattle off $5.78, May feeder cattle off $1.60, August feeder cattle off $8.63, June lean hogs off $12.40 and July lean hogs off $10.00.
LIVE CATTLE:
The contracts were left spinning lower Friday and the cash cattle market saw very little interest. June live cattle closed $1.25 lower at $132.65, August live cattle closed $1.07 lower at $135.27 and October live cattle closed $0.57 lower at $142.47. The big question that the market now has to tackle is: What will packers' interest look like next week? With packers having ample supplies of committed cattle prepared for the weeks ahead, and calf-fed fats being readily available, the cash market could become tough at any time now. Nevertheless, feedlots played their cards well this past week as they kept the live market steady at $140 and pushed dressed cattle $2.00 higher to $232 in the North.
Friday's slaughter is estimated at 118,000 head, 1,000 head less than a week ago and 2,000 head more than a year ago. Saturday's slaughter is projected to be around 40,000 head, 23,000 head less than a week ago and 16,000 head less than a year ago. This week's slaughter is estimated at 656,000 head, 9,000 head less than a week ago and 3,000 head more than a year ago.
Boxed beef prices closed lower: choice down $1.82 ($260.78) and select down $3.09 ($247.97) with a movement of 127 loads (58.71 loads of choice, 20.69 loads of select, 36.45 loads of trim and 11.58 loads of ground beef). On average throughout the week choice cuts averaged $263.21 (down $6.37 from last week) and select cuts averaged $252.82 (down $4.31 from last week) and with a total movement of cuts, grinds, and trim totaling 705 loads.
MONDAY'S CASH CATTLE CALL: Steady to $1.00 lower. Next week's cash cattle trade could be tough as packers will use the market's waning boxed beef prices to help them build a case for lower cash prices.
FEEDER CATTLE:
By the day's end, the corn market wasn't as confident as it was earlier in the day, but regardless of how the corn complex rounded out the day, the market's tout of higher prices before the noon hour was enough to send the feeder cattle contracts lower with no hope of trading higher ahead of Friday's close. May feeders closed $1.60 lower at $156.35, August feeders closed $2.12 lower at $168.27 and September feeders closed $1.97 lower at $171.42. With how expensive all inputs are this year, the market veers lower at any sign or hint of higher feed prices. While parts of the U.S. have been getting moisture and grass should be beginning to grow, the market's technical pressure was too much for the complex to bear. At Winter Livestock Auction in Pratt, Kansas, compared to last week, on a run of 4,047 head feeder steers weighing 500 to 975 pounds traded $2.00 to $5.00 lower. Feeder heifers weighing 750 to 950 pounds traded $2.00 to $3.00 lower. Heifers weighing 500 to 750 pounds traded steady to $2.00 higher. There wasn't a good enough test on steer and heifer calves weighing 400 to 500 pounds, but a lower trend was noted. Slaughter cows and bulls sold steady. The CME Feeder Cattle Index for April 28: down $0.72, $155.64.
LEAN HOGS:
It was a gruesome week for the lean hog market. As traders deemed it necessary for the market to correct, priced plummeted day after day and the spread between the nearby contracts, and the deferred months has shrunk considerably. As we suspected the cash hog market didn't see much interest in Friday's market, but pork cutout values did close slightly higher thanks to a modest $4.03 gain in loins. Nevertheless, the big question now is: When will the market find support? The fact remains that market-ready supplies of hogs is thin, but as equally as important is the fact that consumers aren't being aggressive pork buyers. Pork cutouts totaled 285.68 loads with 265.56 loads of pork cuts and 20.12 loads of trim. Pork cutout values: up $0.09, $104.58. Friday's slaughter is estimated at 460,000 head, 3,000 head less than a week ago and 7,000 head less than a year ago. Saturday's slaughter is projected to be around 40,000 head, 74,000 head less than a week ago and 6,000 head less than a year ago. The CME Lean Hog Index for April 27: down $0.53, $101.81.
MONDAY'S CASH HOG CALL: Steady to somewhat lower. With the market enduring an aggressive technical reset, the cash market may be hesitant to do too much early in the week.
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