GENERAL COMMENTS:
It was a strong day for the livestock complex as both the live cattle and lean hog markets closed fully higher, but the feeder cattle contracts closed mixed. Between the USDA's Outlook report and strong export sales, traders had more than enough confidence in the day. Hog prices closed lower on the Daily Direct Afternoon Hog Report, down $0.87 with a weighted average price of $67.34, ranging from $61.00 to $70.00 on 1,880 head and a five-day rolling average of $67.50. March corn is down 6 1/2 cents per bushel and March soybean meal is down $3.80. The Dow Jones Industrial Average is up 314.76 points.
Thursday's exports shared that beef net sales of 16,600 mt for 2024 were down 19% from the previous week and 18% from the prior four-week average. The three primary buyers were Japan (4,100 mt), China (3,700 mt) and South Korea (3,200 mt). Pork net sales of 71,900 mt for 2024 were up 83% from the previous week and up noticeably from the prior four-week average. The three primary buyers were Mexico (25,000 mt), China (19,500 mt) and Japan (9,100 mt).
LIVE CATTLE:
The live cattle complex had a nice "bounce back" day as the market ran with the support that came to fruition throughout Thursday's trade. Between the strong prices in which the USDA Outlook shared to the higher close in boxed beef prices and the steady/$1.00 lower cash cattle trade – that was enough support to keep traders happy and comfortable through Thursday's end. February live cattle closed $1.00 higher at $183.40, April live cattle closed $1.60 higher at $185.60 and June live cattle closed $0.75 higher at $181.87. Some light trade was reported in parts of Nebraska throughout the day at $287 to $288 which is steady to $1.00 lower than last week's weighted average. Southern live business has been mostly done at $180 which is $2.00 lower than last week's weighted average. Thursday's slaughter is estimated at 123,000 head -- 2,000 head less than a week ago and steady with a year ago.
Thursday's actual slaughter data shared that for the week ending 2/3/2024 steers averaged 909 pounds which is three pounds less than the previous week but one pound more than the same week a year ago. During the same week heifers averaged 827 pounds, which is two pounds more than a week ago but six pounds less than the same week a year ago.
Boxed beef prices closed higher: choice up $1.30 ($295.30) and select up $3.97 ($287.99) with a movement of 134 loads (99.13 loads of choice, 14.48 loads of select, 11.74 loads of trim and 8.17 loads of ground beef).
FRIDAY'S CATTLE CALL: Steady. Given that cash cattle trade has now developed in both regions, it's likely that prices will hold steady with the week's trend.
FEEDER CATTLE:
With the corn complex closing $0.06 to $0.07 lower, one would have thought that the feeder cattle complex would have rounded out the day fully higher given the support that the USDA's Outlook shared and the fact that the live cattle contracts closed higher -- but only the nearby contracts managed to round out the stronger. March feeders closed $0.87 higher at $247.10, April feeders closed $0.62 higher at $250.22 and May feeders closed $0.05 lower at $252.90. With cold temperatures and snow falling across parts of the country, some feeder cattle sales have been slightly lower today. At the Winter Livestock Auction in Pratt, Kansas at their midsession point and when compared to a week ago, feeder steers weighing 700 to 950 pounds sold $2.00 to $6.00 lower and feeder heifers weighing 600 to 900 pounds sold $2.00 to $6.00 lower. The CME feeder cattle index 2/14/2024: down $1.73, $244.93.
LEAN HOGS:
Upon seeing the morning's incredibly strong export report traders deemed it necessary to gap the contracts higher and get the day started off on a strong foot. Thankfully the lean hog contracts were able to keep that momentum through Thursday's end as the USDA Outlook report was supportive of the complex and so were afternoon pork cutout prices. The biggest reason why the carcass was able to close higher is thanks to the $6.48 jump in the ham and the $6.37 gain in the belly. April lean hogs closed $0.47 higher at $85.00, June lean hogs closed $0.92 higher at $97.70 and July lean hogs closed $0.75 higher at $98.57. Pork cutouts totaled 242.74 loads with 207.38 loads of pork cuts and 35.36 loads of trim. Pork cutout values: up $4.04, $89.95. Thursday's slaughter is estimated at 489,000 head -- 2,000 head less than a week ago and 17,000 head. The CME lean hog index 2/13/2024: up $0.49, $74.60.
FRIDAY'S HOG CALL: Lower. It's likely that packers have fulfilled their needs for the week and won't participate much in Friday's cash hog market.
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