Thursday Midday Livestock Market Update - Futures Mostly Quiet

GENERAL COMMENTS:

Livestock futures trading volume has been light so far Thursday, with traders likely in a wait-and-see mode for Friday's round of crop reports, since feed grain prices have been such an influence on cattle and hog futures trade in recent weeks. May corn is down 1 1/2 cents per bushel and May soybean meal is up $0.40 per ton. The Dow Jones Industrial Average is down 181 points and NASDAQ is down 112 points.

LIVE CATTLE:

The live cattle futures chart is relatively quiet so far Thursday, but it does give the impression of a cobra silently coiling and preparing to strike -- in one direction or another. The April futures contract is up $0.525 at $138.225, the June contract is up $0.525 at $134.75, and the August contract is up $0.60 at $136.30. Cash cattle trade, meanwhile, has kept chugging along all week, with another round of light trade seen Wednesday, and the potential for more on Thursday afternoon. Southern live business has been marked at mostly $138, fully steady with the weighted averages of the past two weeks. Northern dressed deals have been marked at mostly $222, roughly steady with last week's weighted average basis Nebraska. Thursday's cattle slaughter is projected at 125,000 head, which is even with week-ago numbers and 5,000 more than year-ago numbers.

Boxed beef prices are higher: choice up $0.44 Thursday morning ($271.48) and select up $0.33 ($261.38) with a movement of 58 total loads (39.79 loads of choice, 11.2 loads of select, 0 loads of trim, and 6.87 loads of ground beef).

FEEDER CATTLE:

Mildly higher futures prices Thursday do little to build back from the sharp losses the feeder cattle market experienced earlier this week. The April futures contract is up $0.35 at $157.45, the May is up $0.50 at $160.45, and farther out, the October is up $1.65 at $174.35. Several rounds of blustery weather are headed across the continent in coming days, which may present challenges for handling livestock or hauling them on highways, but this isn't seen as a big influence on calf prices. Weighted average prices out of salebarns in recent weeks have been keeping the CME Feeder Cattle Index steady between $155 and $156. The bigger threat is probably the upcoming WASDE report on Friday, which could boost feed grain prices (again).

LEAN HOGS:

Now that the peaks of bullish enthusiasm seem to have been smoothed off the lean hog charts, and all the formerly bullish traders have sold off and taken profits from the positions they've wanted to close, a steadier tone seems to be in place. The April lean hog futures contract is up $0.50 at $99.25, the May is up $0.875 at $109.40, and the June is up $1.10 at $115.80. There are plenty of threats still out there for this market, like the U.S. dollar, which is climbing to fresh highs Thursday and may limit the price tags on some pork exports. For now, though, the weekly export sales report showed net pork sales up 49% from the previous week and up 44% from the prior four-week average, with reliable Mexico and colossus China the two biggest buyers. Thursday's hog slaughter is projected at 479,000 head, which is 1,000 fewer than week-ago numbers and 10,000 fewer than a year ago.

The CME Lean Hog Index from 4/4 was 101.66 (down $0.75) and the projected index for 4/5 is 101.08 (down $0.58). Pork cutouts Thursday morning total 130.77 loads with 100.41 loads of pork cuts and 30.37 loads of trim. Pork cutout values: up $7.79, to $112.16.