GENERAL COMMENTS:
The livestock complex is trading mixed as some of the lean hog contracts are mildly higher but the cattle complex is back to lower as traders wait for cash trade to develop in the South. Bids are currently being offered in the South at $182, but that's far from the asking prices set at $187 to $189. May corn is down 2 1/4 cents per bushel and May soybean meal is down $0.50. The Dow Jones Industrial Average is up 75.29 points.
LIVE CATTLE:
The live cattle complex is lower as traders simply seem unwilling to advance the market outside of its current trading trade and are somewhat holding their breath until trade develops in the South. Thankfully, Friday's WASDE report did share higher quarterly price projections for all four quarters in 2024, which should help bring some optimism back to the market. April live cattle are down $0.82 at $187.90, June live cattle are down $0.62 at $183.97, and August live cattle are down $0.67 at $182.82. Bids are currently offered in the South at $182, but with feedlots remaining confident in their asking prices of $187 to $189, those bids are simply too low. Packers will have to get more aggressive if they're going to get cattle bought in the South anytime soon. No new business has developed in the North following Thursday's trade where dressed cattle sold for $292, which is $2.00 higher than last week's weighted average.
Friday's WASDE report was supportive of both the cattle and beef markets. Production for 2024 was increased by 140 million pounds; even though production in the first quarter was slim, the other three quarters in 2024 are expected to be more aggressive in slaughtering cattle. That bodes well for steer prices, and all four quarters of 2024 saw price increased from last month's WASDE report. For 2024, the first quarter is now expected to average $179, which is $3.00 more than last month's projection; the second quarter is now forecasted to average $183, which is $3.00 higher than last month's projection; the third quarter is expected to average $182, which is $2.00 more than last month's projection; and steer prices in the fourth quarter of 2024 are expected to average $186, which is $2.00 more than February's prediction. 2024 beef imports were increased by 50 million pounds from February's WASDE report and 2024 beef exports remained unchanged from a month ago.
Boxed beef prices are higher: choice up $0.35 ($306.96) and select up $0.63 ($296.89) with a movement of 67 loads (52.91 loads of choice, 8.32 loads of select, zero loads of trim and 5.93 loads of ground beef).
FEEDER CATTLE:
The feeder cattle market is back to trading sideways/somewhat lower as the market is following closely to whatever the live cattle complex does. March feeders are down $0.62 at $250.40, April feeders are down $0.80 at $255.62 and May feeders are down $0.30 at $258.15. Even though fundamental demand in the countryside remains incredibly strong (as evidenced by feeder cattle sales this week) the futures complex is trading more cautiously this week.
LEAN HOGS:
The lean hog complex traded hesitantly earlier in the day, but upon studying Friday's WASDE report the market is slightly higher. Friday's WASDE report was extremely encouraging to the hog complex as both the second and third quarters of 2024 are expected to see higher hog prices, and export sales were scaled higher. April lean hogs are unchanged at $84.52, June lean hogs are up $0.52 at $101.70, and July lean hogs are up $0.45 at $103.45.
The projected CME Lean Hog Index for 3/7/2024 is steady at $81.48, and the actual index for 3/6/2024 is up $0.17 at $81.48. Hog prices are lower on the Daily Direct Morning Hog Report, down $3.41 with a weighted average price of $73.88, ranging from $73.00 to $75.00. Pork cutouts total 193.80 loads with 185.53 loads of pork cuts and 8.27 loads of trim. Pork cutout values: up $2.36, $93.51.
Friday's WASDE report was especially supportive to the hog and pork markets. 2024 production was increased by 30 million pounds as chain speeds have been running more aggressively than originally assumed. Hog prices saw some changes from last month's report as faster chain speeds are pushing packers to need more hogs. The first quarter of 2024 didn't see any change in its price forecast as hogs are expected to average $55, but the second quarter is now expected to average $65, which is $3.00 more than February's projection; the third quarter is now expected to average $67, which is $1.00 more than last month's forecast; and hog prices in the fourth quarter of 2024 remained unchanged at $56.00. Pork imports for 2024 fell by 10 million pounds, but exports grew by 50 million pounds.
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