GENERAL COMMENTS:
One would have thought the cash cattle market's $2-to-$4-higher trade would send cattle contracts higher, but traders were uncomfortable with doing anything besides trading lower. Hog prices closed lower on the Daily Direct Afternoon Hog Report, down $0.94 with a weighted average price of $80.30 on 4,053 head. May corn is up 1 3/4 cents per bushel and May soybean meal is up $1.80. The Dow Jones Industrial Average is up 288.83 points.
Thursday's export report stated that beef net sales of 11,000 metric tons (mt) for 2024 -- a marketing year low -- were down 2% from the previous week and 12% from the prior four-week average. The three largest buyers were South Korea (4,300 mt), China (2,100 mt) and Japan (2,000 mt). Pork net sales of 33,800 mt for 2024 were up 36% from the previous week and 10% from the prior 4-week average. The three primary buyers were Mexico (9,200 mt), Canada (8,900 mt) and Japan (5,500 mt).
LIVE CATTLE:
When news began to fly early this morning about a packing plant fire at the National Beef plant in Liberal, Kansas, traders and cattlemen quickly remembered the horrifying fire at Holcomb, Kansas, back in 2019 and weren't able to think about anything else throughout the day. The Kansas fire wasn't even close to the same degree as National's fire was only in its reefer unit and production isn't expected to be gravely affected. But even with cash cattle trading $2 to $4 higher and boxed beef prices rounding out the day stronger, traders wouldn't change their focus and led the live cattle contracts lower through Thursday's end.
April live cattle closed $0.57 higher at $188.37, June live cattle closed $0.27 lower at $184.50 and August live cattle closed $0.42 lower at $183.27. So far this week, Southern live cattle have been marked at $188, $2 higher than last week's weighted average and Northern dressed cattle have sold for mostly $302, $4 higher than last week's weighted average. There was one regional packer in Iowa who paid as much as $304 for heifers with a delivery date of April 15.
The month's Cattle on Feed report will be released Friday afternoon -- placements are expected to be higher. Thursday's slaughter is estimated at 117,000 head -- 5,000 head less than a week ago and 8,000 head less than a year ago.
Boxed beef prices closed higher: choice up $0.29 ($313.73) and select up $1.02 ($303.73) with a movement of 118 loads (72.46 loads of choice, 17.09 loads of select, 12.06 loads of trim and 16.35 loads of ground beef).
FRIDAY'S CATTLE CALL: Steady. Given that cattle have now traded in both regions, it's likely trade remains steady with the week's trend.
FEEDER CATTLE:
The feeder cattle complex followed the live cattle market's lead and elected to trade lower throughout the day despite cash cattle trading higher and feeder cattle sales being strong. April feeder cattle closed $0.30 lower at $254.62, May feeders closed $0.72 lower at $258.07 and August feeder cattle closed $0.87 lower at $268.40.
At Winter Livestock Auction, in Pratt, Kansas, compared to last week and at its midsession point, there weren't enough steers sold to develop an accurate trend but feeder heifers weighing between 700 and 950 pounds sold $4 to $6 higher. Feeder cattle supply over 600 pounds was 96%. The CME feeder cattle index 3/20/2024: up $0.41, $251.82.
LEAN HOGS:
The lean hog complex couldn't gain much traction throughout the day as the market closed lower in its nearby contracts. I thought today's export report would help the market, but it seems traders ran out of steam for the market. Given the complex is trading at a high threshold compared to the last six months, they're comfortable for the time being at these prices.
April lean hogs closed $0.40 lower at $84.90, June lean hogs closed $1.32 lower at $99.30 and July lean hogs closed $1.42 lower at $101.90. Pork cutouts did close lower, with the cut seeing the most pressure being the rib which fell $7.58. Pork cutouts totaled 196.95 loads with 167.90 loads of pork cuts and 29.05 loads of trim. Pork cutout values: down $0.10, $92.08. Thursday's slaughter is estimated at 490,000 head -- 17,000 head more than a week ago and 1,000 head less than a week ago. The CME lean hog index March 19: up $0.39, $83.21.
FRIDAY'S HOG CALL: Lower. Given that packers have bought already this week, it's likely they vaguely participate in Friday's cash market.
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