GENERAL COMMENTS:
Midafternoon Thursday, a light movement was noted in the South as live cattle began to trade for $178, which is steady to $1 lower than last week's weighted average. The North remains in a heated standoff with packers, and no dressed trade has been reported just yet. The nearby lean hog contracts drew back ahead of closing as traders noted the pullback in pork cutout values. Hog prices closed higher on the Daily Direct Afternoon Hog Report, up $1.88 with a weighted average price of $100.20 on 12,656 head. December corn is up 13 cents per bushel, and December soybean meal is down $1.40. The Dow Jones Industrial Average is down 362.82 points.
LIVE CATTLE:
The live cattle complex waited patiently throughout the day for the market to tip its hand and show the direction that cash cattle trade would develop. With packers playing hard ball (showing little interest in the cash market and dialing back processing speeds this week), everyone was kept on their toes, guessing what this week's trade would amount to. A light movement of cattle has been reported in the South at $178, which is steady to $1 lower than last week's weighted average. The North has yet to trade cattle, and with their showlists being green and current, packers may have to up their bids if they desire to get any Northern cattle bought this week. Regardless of what happens in the North, I can't help but to applaud feedlot managers again this week as they continue to go to bat, week in and week out, scrapping for every dollar that they market may potentially be able to give. August live cattle closed $0.37 lower at $174.57, October live cattle closed $0.45 lower at $177.42, and December live cattle closed $0.57 lower at $181.62.
Thursday's slaughter is estimated at 127,000 head -- 2,000 head more than a week and year ago.
Thursday's actual slaughter data shared that for the week ended June 18, steers averaged 883 pounds, which is 1 pound heavier than the previous week and 4 pounds heavier than a year ago. For the same week, heifers averaged 805 pounds, which is 4 pounds lighter than the previous week and 5 pounds lighter than a year ago.
Boxed beef prices closed lower: choice down $2.91 (319.87) and select down $2.72 ($289.97) with a movement of 126 loads (80.59 loads of choice, 25.04 loads of select, 5.03 loads of trim and 15.43 loads of ground beef).
FRIDAY'S CATTLE CALL: South steady, North steady to somewhat higher. Given that a light movement has already been noted in the South, Southern prices will likely remain steady through Friday, but it's a gamble as to what's going to happen in the North. Prices could trade higher if packers are genuinely in need of cattle, but packers could elect to sit this week out and try again next week instead.
FEEDER CATTLE:
As the corn complex regains some lost ground from last week's tumultuous descent, the feeder cattle contracts are retreating, as pressure seems to be building from multiple fronts this week. The combination of higher corn prices amid a steady to somewhat lower cash cattle market doesn't offer feeders the support they desire. Regular feeder cattle sales will resume next week, but receipts continue to be scant this week. August feeders closed $2.42 lower at $242.27, September feeders closed $2.82 lower at $245.32 and October feeders closed $2.77 lower at $247.12. The CME feeder cattle index 7/5/2023: down $2.54, $230.26.
LEAN HOGS:
The lean hog complex closed mixed with its nearby contracts, facing a little pushback, while the market's deferred contracts closed mildly higher. Pork cutout values were strained all throughout the day, and even though cash prices saw modest support, traders were apprehensive with the decline in pork cutout price. July lean hogs closed $1.22 lower at $100.05, August lean hogs closed $0.32 lower at $97.12 and October lean hogs closed $1.15 higher at $81.70. At noon, both the butt and belly price were down significantly, and that trend continued through the day's afternoon closing report too, as bellies ended the day $11.53 lower, and the butt dropped $8.96 lower from Wednesday's close. Pork cutouts totaled 311.00 loads with 285.91 loads of pork cuts and 25.09 loads of trim. Pork cutout values: down $3.69, $105. Thursday's slaughter is estimated at 472,000 head -- 16,000 head more than a week ago and 7,000 head more than a year ago. The CME lean hog index 7/4/2023: not available at this time.
FRIDAY'S HOG CALL: Steady to somewhat lower. Packers don't seem hard pressured and in desperate need of more hogs, but it wouldn't be surprising given that the week's movement has been relatively light, that they modestly support Friday's cash market simply to get a few more head bought and committed.
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