GENERAL COMMENTS:
The livestock complex mixed heading into Friday's noon hour as both the live cattle and lean hog futures trade higher, but feeder cattle futures nearby contracts are lower as corn prices post a mild rally. July corn is up 5 cents per bushel and July soybean meal is up $1.00. The Dow Jones Industrial Average is up 613.64 points.
LIVE CATTLE:
The live cattle complex is mixed as the nearby contracts continue to rally into Friday's noon hour while deferred contracts trade slightly lower. After Thursday's thrilling cash cattle trade, the live cattle market has settled down slightly, seeming to still be in awe of Thursday's accomplishments. No new cash cattle sales have been reported at this point, but a bid of $292 is currently offered in Nebraska. On Thursday Northern dressed cattle traded mostly at $292, which is $8.00 higher than last week's weighted average. Southern live cattle traded from $175 to $180, but mostly at $178 to $180, which is $7.00 to $9.00 higher than the previous week's weighted average. Some more clean-up trade could develop, but largely it's looking like packers did most of their buying Thursday. June live cattle are up $1.40 at $176.30, August live cattle are up $0.52 at $172.92 and October live cattle are up $0.15 at $176.07.
Beef net sales of 18,100 metric tons (mt) for 2023 were down 1% from the previous week but unchanged from the prior four-week average. The three largest buyers were Japan (5,700 mt), South Korea (4,700 mt) and China (3,400 mt).
Boxed beef prices are higher: choice up $2.17 ($308.61) and select up $3.93 ($290.25) with a movement of 70 loads (34.85 loads of choice, 12.52 loads of select, 12.47 loads of trim and 9.92 loads of ground beef).
FEEDER CATTLE:
The feeder cattle market is mixed heading into the noon hour. Nearby contracts are slightly lower as the corn market is posting a mild rally; deferred contracts continue to be focused on the fact that supplies may be tight now. They are only going to get tighter in the months to come, which should have a positive effect on prices. August feeders are down $0.12 at $241.55, September feeders are down $0.12 at $244.82 and October feeders are down $0.17 at $246.80.
LEAN HOGS:
Surprisingly, the lean hog market is trading higher into Friday's noon hour. June lean hogs are up $1.10 at $84.65, July lean hogs are up $1.40 at $83.45 and August lean hogs are up $1.25 at $81.27. With both pork cutout values and cash prices lower, I suspected traders would take a more cautious approach to Friday's market, especially when export sales were only mediocre. But maybe the sentiment in the market gained more support after trading substantially higher earlier this week. Regardless, hog producers are thankful as they need all the support they can get.
The projected CME Lean Hog Index for 6/1/2023 is up $0.89 at $80.52 and the actual index for 5/31/2023 is up $0.10 at $79.63. Hog prices are lower on the Daily Direct Morning Hog Report, down $4.21 with a weighted average of $81.37, ranging from $77.00 to $87.00 on 3,465 head and a five-day rolling average of $82.13. Pork cutouts total 193.16 loads with 180.29 loads of pork cuts and 12.98 loads of trim. Pork cutout values: down $0.09, $85.59.
Pork net export sales of 22,600 mt for 2023 were down 23% from the previous week and 36% from the prior four-week average. The three largest buyers were Mexico (9,300 mt), Japan (3,900 mt) and Canada (2,100 mt).
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