GENERAL COMMENTS:
It was a mixed day for the livestock complex as the lean hog market finally came into some support from the day's export report and from stronger afternoon pork cutout values, but the cattle complex rounded out the day on a softer note. Hog prices closed lower on the Daily Direct Afternoon Hog Report, down $0.46 with a weighted average price of $86.90 on 1,322 head. July corn is down 2 1/2 cents per bushel and July soybean meal is up $1.10. The Dow Jones Industrial Average is up 483.42 points.
From Friday-to-Friday livestock futures scored the following changes: June live cattle down $2.15, August live cattle down $2.67; August feeder cattle down $3.83, September feeder cattle down $3.63; June lean hogs up $0.08, July lean hogs down $0.10; July corn down $0.19, September corn down $0.21.
Thursday's export report shared that beef net sales of 15,700 mt for 2024 were down 27% from the previous week and 12% from the prior four-week average. The three largest buyers were Japan (4,500 mt), China (2,800 mt) and Mexico (1,500 mt). Pork net sales of 44,400 mt for 2024 were up 69% from the previous week and from the four-week average. The three largest buyers were Mexico (23,200 mt), Australia (6,100 mt) and Japan (3,600 mt).
LIVE CATTLE:
Even though the live cattle complex would have loved to trade higher and round out this week on a stronger note -- the market was never able to shake the gloomy nature that overcame the market when China banned beef imports from the JBS packing plant in Greeley, Colorado on Wednesday because traces of ractopamine were found in some of the beef. Since Wednesday's announcement, the market gradually traded lower through Friday's end and even the cash cattle market saw softer trade too. Throughout the week Northern live cattle were marked at mostly $301 which is $3.00 lower than last week's weighted average, and Southern live cattle were sold at mostly $186 which is $1.00 lower than last week's weighted average. June live cattle closed $1.00 lower at $181.55, August live cattle closed $1.32 lower at $178.45 and October live cattle closed $1.32 lower at $180.80.
I do think it's important to note that even though the market ended the week on a softer note, the marketplace is still trading at an incredibly high price point compared to years past. So while it may be disappointing to see 'red' prices summarize the market's performance through Friday's end, all in all, the market is still trading at historically high levels. Just last week a new all-time high was set for the market's five-area weighted average steer price of $190.09.
Friday's slaughter is estimated at 122,000 head -- 5,000 head more than a week ago and 2,000 head less than a year ago. Saturday's slaughter is projected to be around 43,000 head. The week's total slaughter is estimated to be 540,000 head -- incomparable to a week ago but 28,000 head less than a year ago.
Boxed beef prices closed lower: choice down $0.84 ($313.20) and select down $0.81 ($301.71) with a movement of 127 loads (86.57 loads of choice, 21.55 loads of select, 7.37 loads of trim and 11.62 loads of ground beef).
MONDAY'S CATTLE CALL: Lower. It's likely that packers have built up enough supply around them that they won't have to chase after the cash cattle market next week and advance prices again.
FEEDER CATTLE:
Traders may have run out steam ahead of Friday's close -- which is why the feeder cattle contracts closed lower -- but fundamentally the feeder cattle market continues to see tremendous demand in the countryside for both calves and feeders. August feeders closed $2.67 lower at $256.40, September feeders closed $2.55 lower at $258.12 and October feeders closed $2.47 lower at $258.97. It was disappointing to see that the spot August contract closed below the market's 100-day moving average, which could signal that the market could be subject to more pressure in the days ahead from a technical standpoint. The Oklahoma Weekly Cattle Auction Summary shared that compared to last week early feeder sales were steady to $4.00 higher, but late week sales on steers were $3.00 to $9.00 higher and heifers sold $10.00 to $20.00 lower. Slaughter cows and bulls sold steady to $4.00 higher. Feeder cattle supply over 600 pounds was 45%. The CME feeder cattle index 5/30/2024: down $1.04, $248.24.
LEAN HOGS:
The lean hog complex pulled it off -- the market was able to close fully higher ahead of Friday's end thanks to stronger pork exports! June lean hogs closed $0.37 higher at $94.35, July lean hogs closed $0.17 higher at $97.12 and August lean hogs closed $0.25 higher at $96.50. It also was extremely encouraging to see afternoon pork cutout values close higher as the carcass price closed $1.30 stronger -- up mainly because of the $6.07 jump in the ham. Either way, both traders and hog producers alike were thankful to see the futures complex come into some support after trading mostly lower since the end of April. Pork cutouts totaled 304.67 loads with 266.53 loads of pork cuts and 38.15 loads of trim. Pork cutout values: up $1.30, $103.25. Friday's slaughter is estimated at 483,000 head -- 43,000 head more than a week ago and 16,000 head more than a year ago. Saturday's slaughter is projected to be around 235,000 head. The CME lean hog index 5/29/2024: up $0.21, $91.00.
MONDAY'S HOG CALL: Steady. It's unlikely that packers show Monday's cash hog market much interest as they never seem to early in the week -- but if pork cutout values start trading stronger, the cash market could see more support than it has in recent weeks.
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