GENERAL COMMENTS:
The livestock complex rounded out Monday's trade mixed as the feeder cattle market shot lower in reaction to the corn market's higher trend, but both the live cattle and lean hog contracts closed mostly higher. Hog prices closed lower on the Daily Direct Afternoon Hog Report, down $0.58 with a weighted average price of $70.91 on 4,016 head. March corn is up 7 1/4 cents per bushel and May soybean meal is up $0.60. The Dow Jones Industrial Average is down 28.34 points.
Monday's Cold Storage Report shared that total red meat supplies in freezers were up 4% from the previous month but down 11% from last year. Total pounds of beef in freezers were down 1% from last month but down 11% from a year ago. Frozen pork supplies were up 10% from the previous month but down 10% from last year. Stocks of pork bellies were up 14% from last month but down 8% from a year ago.
LIVE CATTLE:
The live cattle complex closed slightly higher as the market elected to bypass fretting over Friday's Cattle on Feed report and focused on the strength that it's currently seeing in the boxed beef market along with the phenomenal strength that came from last week's cash market where prices traded $3.00 to $4.00 higher. April live cattle closed $0.20 higher at $188.10, June live cattle closed $0.22 higher at $184.10, and August live cattle closed $0.20 higher at $183.20. It will be especially interesting to track processing speeds over the next couple of weeks if choice cuts are able to stay above $300.00 as packers will be pressured to either keep processing speeds low to limit their need of the cash market, or they'll be incentivized by the added money in boxed beef prices to allow processing speeds to run a little faster. The latter obviously fairs better for feedlots as it will ensure that fed cattle supplies remain current. New showlists appear to be mixed, higher in Kansas and Nebraska/Colorado, but lower in Texas. Monday's slaughter is estimated at 122,000 head -- 18,000 head more than a week ago but 1,000 head less than a year ago.
Last week Southern live cattle traded at $183, $3 higher than last week's weighted average, while Northern dressed cattle traded for mostly $292, $4 higher than last week's weighted average. Last week's negotiated cash cattle trade totaled 72,872 head. Of that, 90% (65,774 head) were committed to nearby delivery while the remaining 10% (7,098 head) were committed for deferred delivery.
Boxed beef prices closed higher: choice up $1.18 ($301.79) and select up $1.68 ($287.99) with a movement of 82 loads (50.73 loads of choice, 9.87 loads of select, 9.96 loads of trim and 11.70 loads of ground beef).
TUESDAY'S CATTLE CALL: Steady. Given that last week's market saw $3.00 to $4.00 added, packers could be less aggressive this week simply to ensure that prices don't creep any higher.
FEEDER CATTLE:
The feeder cattle complex traded all over the place throughout Monday's market as the report dodged the pressure of last week's bearish Cattle on Feed report, but still closed lower thanks to the $0.07 to $0.08 gain in the corn complex. The live cattle market did however round out the day higher which will likely be the same direction that feeders take later in the week so long as sales continue to report strong feeder cattle interest -- which is nearly inevitable with how thin supplies currently are. March feeders closed $1.52 lower at $253.05, April feeders closed $1.07 lower at $258.90 and May feeders closed $0.50 lower at $261.57. At Oklahoma National Stockyards in Oklahoma City, Oklahoma compared to last week and at their midsession point, feeder steers were trading steady to $2.00 higher, but steers over 850 pounds were trading $5.00 higher. Feeder heifers were trading $2.00 to $4.00 higher. Steer and heifer calves were selling mostly steady. Feeder cattle supply over 600 pounds was 54%. The CME feeder cattle index 2/23/2024: up $1.96, $246.64.
LEAN HOGS:
The lean hog complex closed mostly higher other than in its spot April contract, which could have closed lower simply because pork cutout values ended the day weaker. April lean hogs closed $0.92 lower at $86.27, June lean hogs closed $0.47 higher at $99.85 and July lean hogs closed $0.35 higher at $100.55. If pork cutout values were to close lower I would have naturally guessed that it was because the belly closed lower -- but that wasn't the case today. The cuts closed mixed all across the board but the biggest day-over-day loss was seen in the ham which fell $2.76. Pork cutouts totaled 296.46 loads with 258.41 loads of pork cuts and 38.06 loads of trim. Pork cutout values: down $0.17, $90.99. Monday's slaughter is estimated at 492,000 head -- 2,000 head more than a week ago and 9,000 head more than a year ago. The CME lean hog index 2/22/2024: up $0.32, $79.10.
TUESDAY'S HOG CALL: Steady/somewhat higher. Given that packers weren't aggressive in Monday's market, they'll have to get more aggressive at some point this week.
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