GENERAL COMMENTS:
The cash cattle market saw trade develop throughout the day at steady to $1.00 lower in the South and mostly $1.00 lower in the North. Heading into Thursday's market, both the cattle and hog markets are hopeful for strong export interest. Hog prices closed higher on the Daily Direct Afternoon Hog Report, up $1.40 with a weighted average of $121.18 on 12,187 head. December corn is down 5 1/2 cents per bushel and July soybean meal is up $8.10. The Dow Jones Industrial Average is up 82.32 points.
LIVE CATTLE:
Feedlots did a good job in waiting the day out and trying to push packers for more money (especially in the North), but heading into the holiday weekend, packers weren't budging and cattle ended up trading steady to $1.00 lower in the South and $1.00 lower in the North. As the board has become subject to more technical pressure, as June expires and August takes the center stage, traders haven't been willing to put much support in the market and it's taken the wind out of the cash cattle market's rally. In the South, live cattle traded for $138, and in the North dressed cattle traded for mostly $234. August live cattle closed $0.55 lower at $132.17, October live cattle closed $0.50 lower at $138.90 and December live cattle closed $0.62 lower at $144.62. The market hopes that export interest helps boost the market's tone heading into the later part of the week.
Wednesday's slaughter is estimated at 124,000 head, 2,000 head less than a week ago and 4,000 head more than a year ago.
Boxed beef prices closed lower: choice down $2.26 ($264.88) and select down $2.50 ($240.81) with a movement of 118 loads (61.93 loads of choice, 38.23 loads of select, 5.72 loads of trim and 12.56 loads of ground beef).
THURSDAY'S CASH CATTLE CALL: Steady with the week. Given that cattle have now traded in both regions, prices are set for the week.
FEEDER CATTLE:
The corn market closed mostly lower, other than in the July contract which was able to walk away with a $0.10 rally while the rest of the market closed $0.05 to $0.06 lower. Needless to say, the slight pressure that came from the corn market, coupled with the fact that cash cattle began to sell for steady to $1.00 cheaper in both the North and South, didn't lend the market any support. August feeders closed $1.10 lower at $170.72, September feeders closed $1.17 lower at $173.77 and October feeders closed $1.10 lower at $176.40. At Hub City Livestock Auction in Aberdeen, South Dakota, compared to two weeks ago, the best test was seen on steers weighing 850 to 900 pounds as they sold $2.00 to $3.00 higher, but steers weighing 1,000 to 1,050 pounds traded steady to $3.00 lower and heifers weren't well tested. The CME Feeder Cattle Index for June 28: down $0.12, $164.08.
LEAN HOGS:
Wednesday's Quarterly Hogs and Pigs report came as mixed news. It was encouraging, given that both throughput and pork demand have been questionable variables of the market, to see that the June 1 inventory totaled 72,524 million head, which was down 1% from a year ago and down just slightly from the previous quarter, and it's the lowest inventory that the nation has seen since 2018. What was somewhat challenging in the report was to see the weight breakdown of the marketable hogs and that all weight divisions were down only by 1%. Given that the deferred months of December 2022 and February 2023 are selling with a sizable discount to the rest of the market because of demand concerns, the market needs to see more interest develop to keep the contracts from drifting lower. Besides from the Quarterly report, it was positive to see how the cash hog market and pork cutout values closed higher. Unfortunately, that didn't help the nearby contracts, but the deferred months were able to close with a modest advancement. July lean hogs closed $0.52 lower at $109.40, August lean hogs closed $0.25 lower at $103.57 and October lean hogs closed $0.52 higher at $90.72. Pork cutouts total 246.53 loads with 221.38 loads of pork cuts and 25.15 loads of trim. Pork cutout values: up $3.09, $108.56. Wednesday's slaughter is estimated at 466,000 head, 3,000 head less than a week ago and 4,000 head more than a year ago. The CME Lean Hog Index for June 27: up $0.29, $111.64.
THURSDAY'S CASH HOG CALL: Lower. Given that we're headed into a holiday weekend, it's likely that packers aren't much more aggressive in this week's market.
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