GENERAL COMMENTS:
Boxed beef demand never substantiated like the market had hoped, but thanks to a steady trading cash cattle complex, traders allowed the live cattle complex to close higher. The feeder cattle complex closed mixed with the summer 2024 contracts trending lower, but the lean hog market closed higher as afternoon pork cutout values closed higher. Hog prices closed lower on the Daily Direct Afternoon Hog Report, down $0.94 with a weighted average price of $88.41 on 3,116 head. July corn is up 13 1/4 cents per bushel and July soybean meal is down $1.00. The Dow Jones Industrial Average is up 125.08 points.
From Friday-to-Friday livestock futures scored the following changes: June live cattle down $0.53, August live cattle down $0.45; May feeder cattle down $4.50, August feeder cattle down $3.85; June lean hogs down $0.58, July lean hogs down $1.40; May corn up $0.09, July corn up $0.09.
LIVE CATTLE:
The live cattle contracts turned higher ahead of Friday's close as traders appreciated the cash cattle market's steady trade which is thanks to the commitment of feedlots and their marketing abilities. There was a little cash cattle trade that developed Thursday afternoon, but mostly the week's trade developed on Friday. Southern live cattle traded at $184 to $185, but mostly at $184 which is steady with last week's weighted average. Northern dressed cattle traded at $295 which is also steady with last week's weighted average. June live cattle closed $0.20 higher at $176.15, August live cattle closed $0.40 higher at $174.12 and October live cattle closed $0.42 higher at $177.42.
Friday's WASDE report shared mixed news for the cattle and beef markets. Beef production for 2024 was increased as heavier carcass weights and faster chain speeds are leading to greater production totals. Beef production in 2024 is expected to total 25,595 million pounds -- up 140 million pounds from last month's report. Projected steer prices fell for the three remaining quarters of 2024. Steer prices in the second quarter are now expected to average $184 (down $1.00 from last month), third-quarter prices are expected to average $182 (down $2.00 from last month), and fourth-quarter prices are expected to average $187 (down $3.00 from last month). 2024 beef imports fell by 4 million pounds, but exports grew by 13 million pounds as the first quarter of 2024 sold more product than originally assumed.
Friday's slaughter is estimated at 120,000 head -- 1,000 head more than a week ago and 3,000 head less than a year ago. Saturday's slaughter is projected to be around 13,000 head. The week's total slaughter is estimated at 622,000 head – steady with a week ago and 22,000 head less than a year ago.
Boxed beef prices closed lower: choice down $0.82 ($294.57) and select down $1.59 ($284.17) with a movement of 155 loads (93.95 loads of choice, 26.88 loads of select, 6.12 loads of trim and 28.37 loads of ground beef).
MONDAY'S CATTLE CALL: Steady to somewhat lower. With packers having built up ample supplies around them, it's likely that next week's market trades will be steady to somewhat lower.
FEEDER CATTLE:
The feeder cattle complex close mixed with the summer 2024 contracts rounding out the week lower while the deferred months closed higher. May feeders closed $0.15 higher at $238.80, August feeders closed $0.15 lower at $250.90 and September feeders closed $0.10 lower at $251.97. The feeder cattle complex remained under strenuous pressure through the week's end as technically speaking the market continues to yearn for support but without boxed beef demand strengthening, the market remains under pressure despite sales in the countryside still holding relatively strong. The Oklahoma Weekly Cattle Auction Summary shared that compared to last week and throughout the entire state, steers traded $3.00 to $5.00 lower except six to seven weight steers which traded $5.00 to $7.00 higher. Heifers over 650 pounds sold steady to $2.00 higher, but heifers under 650 pounds traded $2.00 to $7.00 lower. Slaughter cows sold $3.00 to $4.00 higher and slaughter bulls traded $1.00 lower. Feeder cattle supply over 600 pounds was 79%. The CME feeder cattle index 5/9/2024: not available at this time.
LEAN HOGS:
Surprisingly the lean hog complex closed higher despite receiving a less-than-desirable WASDE report Friday morning. June lean hogs closed $0.65 higher at $98.37, July lean hogs closed $0.40 higher at $101.45 and August lean hogs closed $0.20 higher at $100.57. What partly helped the day succeed was the fact that afternoon pork cutout values closed higher. The carcass price was pushed higher as the butt closed $7.13 higher and the ham closed $3.42 higher. Pork cutouts totaled 288.40 loads with 259.65 loads of pork cuts and 28.75 loads of trim. Pork cutout values: up $1.34, $99.77. Friday's slaughter is estimated at 473,000 head – 11,000 head more than a year ago and 17,000 head more than a year ago. Saturday's slaughter is projected to be around 9,000 head. The CME lean hog index 5/8/2024: steady, $91.28.
Friday's WASDE report shared disappointing news for the hog and pork markets in 2024. Pork production in 2024 was decreased by 26 million pounds as greater processing speeds in the first half of the year are more than offset by the lighter carcass weights projected in the second half of the year. Pork production in 2024 is expected to total 28,064 million pounds -- 26 million pounds less than last month's estimate. Unfortunately, hog prices for the remaining three quarters of 2024 were lowered as demand in the second half of the year is expected to be weaker. Hog prices in the second quarter of 2024 are expected to average $68 (unchanged from last month), third-quarter hog prices are expected to average $71 (down $1.00 from last month), and fourth-quarter hog prices are expected to average $56 (down $1.00 from last month). 2024 pork imports fell by 2 million pounds from last month, but exports fell by 78 million pounds as demand has weakened.
MONDAY'S HOG CALL: Lower. It's likely that packers will only lightly participate in Monday's cash hog market and that prices will trend lower.
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