GENERAL COMMENTS:
The livestock complex is trading mostly higher, although some of the lean hog contracts are facing some minor push back. A little more cash cattle trade could develop before the day's end, especially in the North, but, at this point, prices are mostly set for the week. December corn is down 7 cents per bushel and December soybean meal is down $4.90. The Dow Jones Industrial Average is down 14.60 points.
LIVE CATTLE:
The live cattle complex is back to trading higher as traders see feedlots' ability to keep the cash cattle market steady to only $1.00 lower as a tremendous accomplishment. Packers have used nearly every trick in the book, padding themselves with ample supplies of committed cattle, reducing slaughter speeds and trying to use the regression in box prices all as means to work the cash cattle market lower, and while they did get some cattle to trade for $1.00 lower in the South, feedlots put up one heck of fight and kept the market as close to steady as possible. Thankfully, for feedlots' sake, with cold storage supplies being thin, packers are going to have to remain semi-engaged in the cash market. Another light round of trade is developing in Nebraska at $290, which is fully steady with last week's weighted average. A little more cleanup trade could develop in the South, but prices will likely remain steady with Thursday's trade. On Thursday trade in the South was reported at $178, which is steady to $1.00 lower than last week's weighted average.
Beef net sales of 17,000 mt for 2023 were up 41% from the previous week and 33% from the prior four-week average. The three largest buyers were Japan (5,100 mt), South Korea (3,700 mt) and Taiwan (2,200 mt).
Boxed beef prices are lower: choice down $2.07 ($317.80) and select down $1.80 ($288.17) with a movement of 81 loads (54.31 loads of choice, 11.19 loads of select, 7.26 loads of trim and 8.67 loads of ground beef).
FEEDER CATTLE:
Once again, the back-and-forth dance between feeders and corn prices continues Friday, as the nearby corn contracts are trending $0.03 to $0.07 lower, which is helping boost the morale in the feeder cattle arena. Not to mention, feeders also find it supportive that cash cattle prices have been able to trade $1.00 lower to steady, which continues to show the committed nature of feedlots as they scrap for every dollar that the market may have to spare. Feeders will likely see a boost in fundamental support next week as regular feeder cattle sales resume. August feeders are up $1.65 at $243.87, September feeders are up $1.60 at $246.92 and October feeders are up $1.57 at $248.70.
LEAN HOGS:
The lean hog complex is trading mixed as traders seem exhausted after running the contracts higher earlier this week. The belly continues to be extremely volatile as, once again, it's midday price jumps nearly $12.00 higher, which does help Friday's overall cutout carcass price but could mean that next week's prices are again subject to wide price swings. With Friday morning cash prices down over $3.00 and less than 1,500 head having been traded, it's looking like the week's cash hog trade is essentially done with. July lean hogs are down $1.00 at $99.05, August lean hogs are down $1.62 at $95.47 and October lean hogs are up $0.05 at $81.75.
The projected lean hog index for July 6 is up $1.36 at $97.43, and the actual index for July 5 is up $1.39 at $96.07. Hog prices are lower on the Daily Direct Morning Hog Report, down $3.09 with a weighted average price of $97.66, ranging from $87.00 to $100.00 on 1,416 head and a five-day rolling average of $99.41. Pork cutouts total 144.68 loads with 132.56 loads of pork cuts and 12.12 loads of trim. Pork cutout values: up $2.26, $107.26.
Pork net sales of 26,000 mt for 2023 were down 3% from the previous week and from the prior four-week average. The three largest buyers were Mexico (15,100 mt), Canada (4,600 mt) and Japan (1,700 mt).
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