GENERAL COMMENTS:
The livestock complex is again trading mixed as the cattle contracts rally on the corn market's weakness, but the lean hog market is still struggling to find footing. Heading into Tuesday afternoon, we'll be watching how pork cutout values close. May corn is down 9 1/2 cents per bushel and May soybean meal is down $14.40. The Dow Jones Industrial Average is down 129.85 points.
LIVE CATTLE:
The live cattle complex is back to trading higher as the market finds comfort in cheaper corn and in strong beef demand. April live cattle are up $0.50 at $165.47, June live cattle are up $0.60 at $161.47 and August live cattle are up $0.67 at $160.32. As the spot April contract begins to pressure the new contract high established last week, traders could hold the market right below that threshold as they'd like to see some support in the cash market before they advance the contracts again. Early asking prices are noted in the South at $166-plus but are still not established in the North. Trade isn't likely to develop until Thursday or later.
Boxed beef prices are higher: choice up $1.41 ($289.75) and select up $1.71 ($280.96) with a movement of 58 loads (27.01 loads of choice, 7.46 loads of select, 14.76 loads of trim and 9.11 loads of ground beef).
FEEDER CATTLE:
Watching the corn complex trend lower has been almost as good as a weeklong trip to the Bahamas for most feedlot managers. The two biggest limiting factors for the feeder cattle market has been inputs (with corn being one of the biggest factors) and the upside potential of the fat cattle market. The fat cattle market has slowly been grinding higher week in and week out, but finally the corn complex is starting to correct. The fact that both factors are trading in a way that helps the feeder cattle market has undoubtedly been noticed by traders. March feeders are up $0.65 at $189.82, April feeders are up $0.82 at $195.02 and May feeders are up $0.85 at $199.57.
LEAN HOGS:
The lean hog complex is trading lower as the market longs to find footing in today's environment. We understand that, come the second half of the year, supplies should be tighter and, with demand also expected to be stronger, that the market stands an excellent chance at again trading higher. However, the touch and go nature of demand in today's market has the lean hog complex holding its breath. April lean hogs are down $0.20 at $84.52, June lean hogs are down $1.00 at $101.07 and July lean hogs are down $0.75 at $103.77. I find it interesting to note that cash hog prices are lower at midday, which could be different by the day's end as packers will likely procure more hogs Tuesday afternoon. Then again, if pork cutout values show any weakness, packer demand could grow cold.
The projected lean hog is unavailable at this time. Hog prices are lower on the Daily Direct Morning Hog Report, down $0.42 with a weighted average of $77.43, ranging from $71.00 to $79.00 on 8,882 head and a five-day rolling average of $77.60. Pork cutouts total 137.60 loads with 125.43 loads of pork cuts and 12.17 loads of trim. Pork cutout values: up $0.81, $86.75.
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