GENERAL COMMENTS:
Higher corn prices kept the cattle contracts from rallying unbridled throughout Monday's trade, but if the market's fundamentals shine like they did last week -- higher trade will likely be in play for the later part of the week. Hog prices closed lower on the Daily Direct Afternoon Hog Report, down $2.14 with a weighted average price of $86.43 on 2,002 head. July corn is up 8 cents per bushel and July soybean meal is up $5.30. The Dow Jones Industrial Average is down 196.82 points.
LIVE CATTLE:
With corn prices trading higher and it being early in the week, traders elected to mildly support the live cattle complex ahead of the day's close, although the August and October 2024 contracts closed slightly lower. The day's slight softness in some of the nearby contracts likely stems from the unknowingness of whether or not cash cattle prices will trade higher again this week, and how boxed beef prices will fair. If traders are going to continue to advance the nearby contracts, they're going to need unwavering fundamental support as the contracts are already breaking out into higher territory as opposed to trading in the comfortable sideways norm. June live cattle closed $0.42 higher at $181.47, August live cattle closed $0.50 lower at $178.55 and October live cattle closed $0.12 lower at $181.82. New showlists appear to be mixed, higher in Kansas, somewhat lower in Nebraska, and lower in Texas. Monday's slaughter is estimated at 120,000 head -- 4,000 head more than a week ago and 5,000 head less than a year ago.
Throughout last week Southern live cattle traded at $186 which is $2.00 higher than the previous week's weighted average and Northern dressed cattle traded at $300 which is $5.00 higher than the previous week's weighted average. Last week's negotiated cash cattle trade totaled 93,719 head. Of that 67%, (62,841 head) were committed to the nearby delivery, while the remaining 33% (30,878 head) were committed to the deferred delivery.
Boxed beef prices closed mixed: choice down $0.75 ($312.70) and select up $1.95 ($299.35) with a movement of 117 loads (58.83 loads of choice, 21.68 loads of select, 21.07 loads of trim and 15.62 loads of ground beef).
TUESDAY'S CATTLE CALL: Steady to somewhat higher. Yes, packers have bought ample cash cattle supplies in recent weeks, but if they're going to supply consumers with meat they're going to need to keep processing cattle.
FEEDER CATTLE:
With the corn complex closing $0.07 to $0.08 higher the feeder cattle complex wasn't able to take on its market's resistance at the 100-day moving average as it seemed too early in the week to do so without more support having developed. Sales in the countryside continued to rally, however, on strong demand as buyers see boxed beef demand and the cash market's $2.00 to $5.00 rally last week as more than enough support to justify higher business. The complex may trade higher later in the week if the market's fundamentals remain strong, but from a technical standpoint traders felt more comfortable holding the market steady through today's trade. May feeders closed $0.02 lower at $246.70, August feeders closed $1.37 lower at $258.47 and September feeders closed $1.20 lower at $259.65. At Joplin Regional Stockyards in Carthage, Missouri compared to last week and at their midsession point, feeder steers were selling for $4.00 lower to $10.00 higher while heifers were selling $6.00 to $12.00 higher. Feeder cattle supply over 600 pounds was 60%. The CME feeder cattle index 5/17/2024: up $0.71, $243.04.
LEAN HOGS:
The lean hog complex rounded out the day on a stronger note as traders were encouraged by slightly higher pork cutout values, and by the day's substantial movement of 327.04 loads. June lean hogs closed $0.42 higher at $96.92, July lean hogs closed $0.10 lower at $99.95 and August lean hogs closed $0.27 lower at $99.20. The bigger movement of pork cuts could be sales ahead of the Memorial Day weekend and prime grilling conditions, and it could also be because retailers are concerned that beef is getting too expensive for some consumers who may choose to look at pork instead. Pork cutouts totaled 327.04 loads with 284.26 loads of pork cuts and 42.78 loads of trim. Pork cutout values: up $0.92, $101.77. Monday's slaughter is estimated at 482,000 head -- 21,000 head more than a week ago and 10,000 head more than a year ago. The CME lean hog index May 15/2024: up $0.37, $92.13.
TUESDAY'S HOG CALL: Higher. With pork cutout values closing slightly higher, packers may be slightly more interested in participating in Tuesday's cash market.
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