GENERAL COMMENTS:
The live cattle complex is rallying into Wednesday afternoon, which is causing packers some grief as they were hoping to buy cattle at steady money this week and not see much pushback from feedlots. The cash cattle market has been painfully quiet and it's tough saying what packers will do next as they sit on a plethora of cattle that were purchased in weeks past. July corn is up 11 1/4 cents per bushel and July soybean meal is down $3.00. The Dow Jones Industrial Average is up 51.62 points.
LIVE CATTLE:
The live cattle contracts are thankful to have traders interest and the ability to regain some position that was thrown away earlier in the week. June live cattle are up $2.10 at $134.50, August live cattle are up $1.25 at $135.35 and October live cattle are up $1.17 at $142.55. Packers haven't been overly excited to show the cash cattle market much interest as the board's taken a supportive run on Wednesday. But with prime grilling season nearing, can they just let the time pass them by? Bids of $227 are being offered in Nebraska and bids of $144 and $230 are being offered in Iowa. A handful of cattle sold in Nebraska for $144 and in Texas for $140 -- both mostly steady with the week's trend. Packers do have a considerable volume of cattle at their disposal as they've strategically padded their inventory over the last month. More trade is expected to develop ahead of the week's end, but it could be a thin week compared to the last three weeks of over 100,000 head traded. Asking prices for cattle left on showlists are around $140-plus in the South and $232-plus in the North.
The Fed Cattle Exchange Auction on Wednesday listed a total of 1,317 head, of which 246 actually sold, none were scratched from the auction and 1,071 head were listed as unsold, as they did not meet the reserve prices that ranged from $134 to $141. Opening prices ranged from $132 to $138, high bids ranged from $137 to $140. The state-by-state breakdown looks like this: Texas 1,177 total head, with 246 head sold at $137, 931 head went unsold; Kansas 140 total head, of which none sold.
Boxed beef prices are lower: choice down $0.22 ($255.02) and select down $0.03 ($242.32) with a movement of 123 loads (65.25 loads of choice, 18.75 loads of select, 5.97 loads of trim and 33.51 loads of ground beef).
FEEDER CATTLE:
As the corn market jumps and strikes a 12- to 15-cent rally, the feeder cattle contracts are largely keeping with their lower trade. May feeders are up $0.15 at $159.07, August feeders are down $0.80 at $171.05 and September feeders are down $0.72 at $174.25. The live cattle complex is trending higher into Wednesday afternoon, but with the corn market posing higher input costs it's unlikely the feeder cattle market will be able to shake the bearish worry of higher corn.
LEAN HOGS:
The lean hog market is keeping with its lower trend, even as the cash market leaps higher. This week has been unusual in the sense that the cash hog market has seen steady interest from packers and at notably higher prices. Packers are having to continue to chase hogs in the cash market as supplies are thin, even though pork cutout values are mostly under pressure, they need hogs to kill in order to meet their commitments. June lean hogs are down $0.60 at $100.97, July lean hogs are down $1.10 at $101.87 and August lean hogs are down $1.27 at $102.07.
The projected CME Lean Hog Index for 5/10/2022 is up $0.17 at $101.26 and the actual index for 5/9/2022 is steady at $101.09. Hog prices are higher on the Daily Direct Morning Hog Report, up $6.67 with a weighted average of $112.36, ranging from $102.00 to $114.50 on 2,178 head and a five-day rolling average of $103.89. Pork cutouts total 148.33 loads with 132.56 loads of pork cuts and 15.76 loads of trim. Pork cutout values: up $0.51, $100.70.
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