GENERAL COMMENTS:
Technically speaking, the board had a tremendous day in the lean hog complex, but both the live cattle and feeder cattle contracts struggled as the market gasped upon seeing grain prices skyrocket higher. Hog prices averaged $97.22 on the Daily Direct Hog Report, with a movement of 3,989 head and a five-day rolling average of $98.38. May corn is up 23 cents per bushel and May soybean meal is up $4.60. The Dow Jones Industrial Average is down 39.54 points.
LIVE CATTLE:
It was a day of lower trade for the live cattle complex. The futures market tumbled lower, with the October and December 2022 contracts taking the brunt of the market's pressure and seeing the most significant losses for the day. With the market now back below the 40-day and 100-day moving, last week's gains seem thrown away with Monday's close. April live cattle closed $0.20 lower at $140.47, June live cattle closed $0.62 lower at $135.80 and August live cattle closed $0.95 lower at $137.37. The cash cattle market didn't see any action as packers enjoyed seeing the market's downward pressure play out, and feedlots articulated their showlists. New showlists appear to be somewhat larger in Kansas, and larger in Texas and Nebraska.
Monday's slaughter is estimated at 118,000 head, 6,000 head less than a week ago and 1,000 head less than a year ago.
Last week's negotiated cash cattle trade totaled 97,066 head. Of that 73% (70,737 head) were committed for nearby delivery, while the remaining 27% (26,329 head) were committed for deferred delivery.
Boxed beef prices closed mixed: choice down $1.54 ($271.08) and select up $0.56 ($259.46) with a movement of 107 loads (60.05 loads of choice, 22.31 loads of select, 11.96 loads of trim and 12.60 loads of ground beef).
TUESDAY'S CASH CATTLE CALL: $1.00 higher. Packers were aggressive in last week's market and their aggression showed that they were short bought. If packers continue to run aggressive processing speeds, they'll likely need more cattle again this week.
FEEDER CATTLE:
It was hard for the feeder cattle contracts to look over and see the grain market zooming higher, as that meant one direct, unquestionable fate for the feeder cattle contracts -- lower. May feeders closed $2.62 lower at $159.15, August feeders closed $2.87 lower at $171.47 and September feeders closed $2.65 lower at $174.97. Early in the day, the live cattle complex acted like it wanted to trade higher, but unless cash cattle trade higher and the live cattle contracts follow suit, the feeder cattle market will likely continue to focus on the behavior of the grain market and trade accordingly to the grain market's developments. At Joplin Regional Stockyards, compared to last week on a run of 4,088 head, feeder steers traded fully steady and feeder heifers traded steady to $3.00 higher. The CME Feeder Cattle Index: down $1.01, $154.62.
LEAN HOGS:
The lean hog complex will have some tough questions to answer in the days ahead. As a head and shoulders pattern forms in the charts, and pork cutout prices didn't close higher, people are questioning what the market's demand really is. Nevertheless, the lean hog contracts busted higher and claimed $2.00 to $3.00 advancements in the market's nearby contracts. June lean hogs closed $0.62 lower at $135.80, August lean hogs closed $0.95 lower at $137.37 and October lean hogs closed $1.05 lower at $143.77. Pork cutouts totaled 295.15 loads with 255.51 loads of pork cuts and 39.64 loads of trim. Pork cutout values: down $0.72, $109.49. Monday's slaughter is estimated at 353,000 head, 122,000 head less than a week ago and 131,000 head less than a year ago. The CME Lean Hog Index for April 14: up $0.39, $99.98.
TUESDAY'S CASH HOG CALL: Lower. Given that pork cutout values didn't perform well through Monday's market, it's likely that cash prices don't see a bump in Tuesday's market.
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