GENERAL COMMENTS:
It was a powerhouse week for the cattle contracts. even though by Friday's end. both the live cattle and feeder cattle contracts closed lower. The lean hog market was finally able to catch a break and see higher trade ahead of the weekend. Hog prices closed lower on the Daily Direct Afternoon Hog Report, down $2.69 with a weighted average of $115.30 on 3,968 head. July corn is up 1/4 cent per bushel and July soybean meal is up $1.60. The Dow Jones Industrial Average is down 880.00 points.
From Friday to Friday, livestock futures scored the following changes: June live cattle up $2.60, August live cattle up $2.35; August feeder cattle up $0.60, September feeder cattle down $0.25; June lean hogs down $2.40, July lean hogs down $5.27; July corn up $0.46, ad September corn up $0.32.
LIVE CATTLE:Good news continued Friday, as packers were short bought leading up to the noon hour. Scrambling to get some more cattle bought, Kansas and Texas saw cattle trade for mostly $137, but there were some instances when cattle sold at $140. Throughout the week, Southern live cattle traded for $136 to $137 ($1.00 to $2.00 higher than last week), and Northern dressed cattle traded for $225 to $226 ($3.00 to $4.00 higher than last week). Seasonally, this is a time when both the board and the cash market cascade lower, but with the aggressive slaughter speeds that fed cattle and beef cows have been processed, showlists continue to remain manageable and it's helping feedlots demand higher prices. June live cattle closed $0.85 lower at $136.20, August live cattle closed $1.00 lower at $136.20 and October live cattle closed $0.67 lower at $141.97.
Friday's slaughter is estimated at 124,000 head, 2,000 head less than a week ago and 5,000 head more than a year ago. Saturday's kill is projected to be around 47,000 head. This week's slaughter is estimated at 674,000 head, 71,000 head more than a week ago and 4,000 head more than a year ago.
Boxed beef prices closed mixed: choice up $0.22 ($271.32) and select down $0.72 ($248.89) with a movement of 110 loads (63.51 loads of choice, 23.47 loads of select, 13.25 loads of trim and 9.54 loads of ground beef). Throughout the week choice cuts averaged $271.03 (up $3.82 from last week) and select cuts averaged $249.71 (up $0.41 from last week) and the week's movement of cuts, grinds and trim totaled 546 loads.
MONDAY'S CASH CATTLE CALL: Steady to somewhat higher. So long as processing speeds continue to run as strong as they are, packers are going to need more cattle and feedlots are ready to ask for more money.
FEEDER CATTLE:The feeder cattle complex's momentum ran out ahead of the week's close, but still, the market has much to be proud of. Largely, the feeder cattle market's rally was sparked higher as the live cattle market lent substantial technical support, but then the market was complemented fundamentally as buyers were active participants in sales this past week and pushed both calve and feeder cattle prices higher in multiple regions. Friday, the contracts closed lower as traders let the hours tick by ahead of the weekend's arrival. August feeders closed $1.55 lower at $174.47, September feeders closed $1.32 lower at $176.05 and October feeders closed $1.15 lower at $177.55. Oklahoma's Weekly Feeder Cattle Summary shared that, compared to last week feeder, steers and traded $3.00 to $6.00 higher, steer calves traded $8.00 to $12.00 higher, and heifer calves sold $4.00 to $7.00 higher. Slaughter cows sold $4.00 to $7.00 higher and slaughter bulls sold $6.00 to $7.00 higher. The CME Feeder Cattle Index for June 9: up $2.07, $161.87.
LEAN HOGS:The lean hog complex rounded out the week on a higher note as the board summoned trader interest and even pork cutout values closed slightly higher. July lean hogs closed $0.47 higher at $105.47, August lean hogs closed $0.65 higher at $103.75 and October lean hogs closed $0.47 higher at $92.57. It was disappointing to see Friday's slaughter dip lower to only 446,000 head as the summer has many more days of prime grilling ahead of it. However, given the touch and go nature of the consumers this year, packers are keenly watching demand and making sure that they're not getting too far ahead of the market and going to be stuck sitting on product. It was announced earlier Friday that Italy has confirmed that two cases of African swine fever have been detected in two domestic pigs in the Lazio region. Pork cutouts totaled 253.98 loads with 221.40 loads of pork cuts and 32.58 loads of trim. Pork cutout values: up $0.07, $109.16. Friday's slaughter is estimate at 446,000 head, 32,000 head less than a week ago and 7,000 head less than a year ago. Saturday's kill is projected to be around 19,000 head. The CME Lean Hog Index for June 8: down $0.17, $107.31.
MONDAY'S CASH HOG CALL: Lower. Given that pork demand was spotty this week, it's likely that packers let Monday pass them by, only picking up a few hogs until they can see how pork demand sits.
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