GENERAL COMMENTS:
It was a rough day for the livestock complex as traders were cautious to not over support the contracts ahead of seeing what the market's fundamentals did. Hog prices closed higher on the Daily Direct Afternoon hog report, up $1.18 with a weighted average of $72.85 on 8,415 hogs. July corn closed steady and July soybean meal closed up $1.20 at $433.6. The Dow Jones Industrial Average is down 46.46 at 34,051.70.
LIVE CATTLE:
The live cattle complex struggled throughout Monday's market as traders were tiptoeing around, hoping that demand would keep boxed beef prices elevated and that feedlots would strive for higher cash prices later this week. While feedlots may indeed strive for higher cash prices, getting higher cash prices this week will be difficult. Difficult yes, impossible no. Difficult because last week packers were able to buy a considerable amount of cattle with time. Getting cattle bought at cheaper prices is one thing, but getting cattle bought with time is even more detrimental to the cash market. June live cattle closed $0.60 lower at $164.875, August live cattle closed $1.13 lower at $162.65 and October live cattle closed $0.63 lower at $167.00. New showlists appear to be mixed, somewhat higher, basically near steady in Texas, slightly lower in Nebraska/Colorado and lower in Kansas. Monday's slaughter is estimated at 123,000 head. 1,000 head less than a week ago and 10,000 head more than a year ago. Saturday's cattle slaughter was revised to 22,000 head.
Last week, Northern dressed cattle traded $3.00 to $5.00 lower than the previous week's weighted average, and Southern live cattle sold $2.00 lower than the previous week's weighted average. Last week's negotiated cash cattle trade totaled 83,647 head. Of that, 57% (47,747 head) were committed to the nearby delivery, while the remaining 43% (35,900 head) were committed to the deferred delivery.
Boxed beef prices closed mixed: choice down $1.42 ($310.02) and select up $2.66 ($291.) with a movement of 78.39 loads (48.47 loads of choice, 10.63 loads of select, 8.57 loads of trim and 10.72 loads of ground beef).
TUESDAY'S CATTLE CALL: Steady. Feedlots know that, if they want higher prices, now is the time to push for them before supplies begin to seasonally favor packer's position. But doing so isn't going to be easy when packers have cattle committed to them in the deferred delivery option.
FEEDER CATTLE:
The feeder cattle complex closed lower with the market's biggest hinderance being the uncertainty seen throughout the live cattle market. Traders would love to continue to drive the feeder cattle complex higher as thin supplies are noted throughout sales across the nation, but traders are still needing/wanting support from the live cattle complex too. May feeders closed $1.28 lower at $209.7, August feeders closed $0.63 lower at $230.1 and September feeders closed $0.73 lower at $233.075. At Sioux Falls Regional Cattle Auction in Worthing, South Dakota, compared to last week, feeder steers sold $2.00 to $4.00 lower with the lighter weights seeing the greatest fall off, but the steers weighing 750 to 950 pounds traded steady to $5.00 higher. Feeder heifers sold steady to $5.00 lower on a light test, but again those weighing 600 to 650 pounds sold $6.00 to $7.00 higher. Feeder cattle supply over 600 pounds was 93%. The CME Feeder Cattle Index for April 28: down $1.39, $201.81.
LEAN HOGS:
The lean hog complex traded lower throughout Monday's market as traders were extremely cautious not to get too confident before seeing how this week's demand shapes up. June lean hogs closed $2.00 lower at $89.70, July lean hogs closed $2.37 lower at $91.30 and August lean hogs closed $2.02 lower at $92.65. Yes, pork cutout values closed slightly lower, but demand could perk back up later in the week and give traders the support they need. With grilling season right around the corner, the need for ribs should continue to grow. It is also important to note that cash hog prices closed higher yet again. It's quite amazing that packers have supported the cash hog market as much as they have over the last week and, if/when pork demand strengths this week, traders should again be able to turn the contracts higher. Pork cutouts totaled 267.92 loads with 245.37 loads of pork cuts and 22.55 loads of trim. Pork cutout values: down $0.85, $80.47. Monday's slaughter is estimated at 459,000 head, 10,000 head less than a week ago and 17,000 head less than a year ago. The CME Lean Hog Index for April 27: up $0.20, $71.49.
TUESDAY'S HOG CALL: Steady to somewhat higher. It's tough telling when packers will be flush with the right inventory needed for their upcoming kills. But as of lately it's been clear that they were short bought.
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