GENERAL COMMENTS:
It's been another thriving day for the cattle sector as interested traders continue to support the board in its quest for higher prices. And, thankfully, the market's ambitious pace has helped feedlots market cattle higher this week too. The lean hog complex is lacking sufficient support from traders, but if the afternoon closes with stronger pork cutouts, then Thursday's market could see a different tone. May corn is down 2 3/4 cents per bushel and May soybean meal is down $5.90. The Dow Jones Industrial Average is up 190.69 points.
LIVE CATTLE:
Live cattle futures are back to grinding higher and, with the onset of higher cash cattle trade, the June live cattle contract is now trading above the 40-day moving average. April live cattle are up $0.55 at $140.50, June live cattle are up $0.52 at $136.80 and August live cattle are up $0.80 at $138.45. Feedlots are extremely current in the North and thankfully they've used that to their advantage this week and been able to sell Northern cattle anywhere from $225 to $227 dressed, and upward of $143 live. The aggressive buying was done by a regional packer, who once again draws light to the importance of regional packers and the need for more of them. The South has yet to see any more significant business take place, but for the week live cattle in the South are selling for mostly $139. More trade is expected to develop throughout Wednesday.
The Fed Cattle Exchange Auction listed a total of 3,596 head, of which 150 head actually sold, none were scratched from the auction, and 3,446 head were listed as unsold, as they did not meet the reserve prices, which ranged from $132 to $144. Opening prices ranged from $130 to $138, high bids ranged from $137.50 to $139.50. The state-by-state breakdown looks like this: Texas 1,323 total head, with 150 head sold at $137.50 to $139, 1,173 head went unsold; California 70 total head, all of which went unsold; Nebraska 480 total head, all of which went unsold; Iowa 1,723 total head, all set for delayed delivery (May 21 to June 3) these cattle had a reserve price of $5 per cwt, with opening bids of $1 per cwt. None of these cattle sold.
Boxed beef prices are lower: choice down $0.01 ($273.46) and select down $0.05 ($260.66) with a movement of 87 loads (57.71 loads of choice, 16.22 loads of select, 3.52 loads of trim and 9.45 loads of ground beef).
FEEDER CATTLE:
Feeder cattle futures are excited to be trading higher for the third day in a row as the live cattle market lends ample support and grain prices are trending lower, which helps all the more. May feeders are up $1.17 at $162.10, August feeders are up $0.82 at $174.57 and September feeders are up $0.40 at $177.82. Runs of feeder cattle will likely be light all this week in the North as getting cattle to and from the sale barn is challenging amid snow and blizzard conditions. In the Central and Southern Plains, however, feeder cattle have seen mixed interest with lightweight calves selling with less interest that those weighing 600 pounds or more.
LEAN HOGS:
Traders have left the lean hog complex to fend for its self as the contracts trend anywhere from $0.60 to $0.96 lower despite commendable cash trade Wednesday morning and a strong midday pork cutout report. June lean hogs are down $0.95 at $117.52, July lean hogs are down $0.87 at $118.95 and August lean hogs are down $0.70 at $117.57. As the market looks to what may come after Easter, the big question is: What will consumer demand be? Lent is done Thursday, at which point pork cuts could see a significant increase in demand from consumers.
The projected CME Lean Hog Index is unavailable at this time. Hog prices average $96.47 on the Daily Direct Hog Report, ranging from $95.00 to $103.00 on 4,100 head and a five-day rolling average of $98.07. Pork cutouts total 154.44 loads with 138.65 loads of pork cuts and 15.79 loads of trim. Pork cutout values: up $5.28, $112.08.
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