GENERAL COMMENTS:
Friday marks the one-year point when Russia invaded Ukraine, and thus far it hasn't been a good day for the livestock complex either. It's natural to expect the live cattle market to trade timidly ahead of the afternoon's Cattle on Feed report, but given that corn prices are still traipsing lower, one would expect feeders to be higher and, with a tremendous export sales report of pork, one would expect the lean hog market to be trading higher as well. May corn is down 8 1/2 cents per bushel and May soybean meal is up $0.90. The Dow Jones Industrial Average is down 358.87 points.
LIVE CATTLE:
The live cattle contracts are trading lower as the market tries to shake the doggish nature of Friday's complex, but thus far hasn't been successful in doing so. Friday afternoon's Cattle on Feed report is expected to be extremely supportive to the market as on feed and placement numbers are anticipated to be lighter than a year ago, while marketings are projected to be up 3%-4%. Traders are trying to remain patient with the cash cattle market, but at this point, still no more trade has developed. Bids of $164 are currently being offered in Kansas, and bids of $260 in Nebraska, but otherwise the market remains extremely quiet. Asking prices are around $165-plus in the South and $262-plus in the North.
Beef net sales of 15,400 mt for 2023 were down 45% from the previous week and 35% from the prior four-week average. The three largest buyers were China (4,300 mt), South Korea (2,800 mt) and Japan (2,200 mt).
Boxed beef prices are higher: choice up $0.40 ($288.31) and select up $0.78 ($276.65) with a movement of 57 loads (36.01 loads of choice, 4.13 loads of select, 9.19 loads of trim and 7.50 loads of ground beef).
FEEDER CATTLE:
It's maddening to watch the feeder cattle complex trade lower as the corn contracts continue to drift $0.08 to $0.10 lower in their nearby contracts. It's not helping matters that the live cattle market is trading lower, but with the newest Cattle on Feed report set to be released Friday afternoon, it's not surprising either as traders are pulling back from the market ahead of its release. March feeders are down $0.72 at $188.52, April feeders are down $0.62 at $193.05 and May feeders are down $0.45 at $197.27.
LEAN HOGS:
The lean hog complex is trending lower into Friday's afternoon despite receiving a rather supportive export report Friday morning. April lean hogs are down $0.05 at $86.12, June lean hogs are down $0.70 at $103.25 and July lean hogs are down $0.65 at $105.57. It's interesting to see that packers are paying a little attention to the cash market as morning prices are slightly higher and they've bought a little over 5,500 head. A wet blanket seems to be draped across the entire livestock complex, and if, for some reason, it's removed before closing, the lean hog complex could grow stronger and trade higher as it's fundamentals are sound.
The projected lean hog index for Feb. 23 is down $0.14 at $78.04, and the actual index for Feb. 22 is up $0.65 at $78.18. Hog prices are higher on the Daily Direct Morning Hog Report, up $0.46 with a weighted average of $77.83, ranging from $69.00 to $79.00 on 5,549 head and a five-day rolling average of $77.79. Pork cutouts total 193.54 loads with 184.04 loads of pork cuts and 9.50 loads of trim. Pork cutout values: down $1.47, $84.56.
Pork net sales of 51,900mt for 2023 were up 16% from the previous week and 39% from the prior four-week average. The three largest buyers were Mexico (25,000 mt), China (12,100 mt) and Japan (4,000 mt).
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