GENERAL COMMENTS:
Thursday's trade was largely disappointing as the market saw livestock contracts close lower as consumer demand isn't developing as traders hoped. The cash cattle market still hasn't seen much trade develop, but some live sales were reported in Texas at $185, $1 higher than last week's weighted average. Hog prices closed lower on the Daily Direct Afternoon Hog Report, down $2.44 with a weighted average price of $89.35 on 1,481 head. July corn is down 2 cents per bushel and July soybean meal is down $5.60. The Dow Jones Industrial Average is up 331.37 points.
Thursday's export report shared that beef net sales of 12,300 metric tons (mt) for 2024 were down 45% from the previous week and 29% from the prior 4-week average. The three largest buyers were Japan (4,400 mt), South Korea (1,900 mt) and Mexico (1,700 mt). Pork net sales of 24,400 mt for 2024 were down 27% from the previous week and 26% from the prior 4-week average. The three largest buyers were China (6,900 mt), Japan (3,900 mt) and Canada (3,700 mt).
LIVE CATTLE:
Thursday's trade ended up being a swing and a miss for the live cattle complex as the market neglected to find any technical footing in the day's trade but did see a little positive momentum in the cash sector. June live cattle closed $0.52 lower at $175.95, August live cattle closed $0.50 lower at $173.72 and October live cattle closed $0.45 lower at $177.
Thursday's technical pressure was due to a combination of factors but mostly due to the weak performance of boxed beef prices and the morning's lackluster export sales report.
The only bright news from Thursday's trade was the thin movement of cattle traded in Texas at $185, $1 higher than last week's weighted average. Otherwise, the complex didn't see any other trade develop as packers were slow to offer bids and feedlots are determined to see prices trade higher again this week. Asking prices in the South are firm at $186 to $187 and $297-plus in the North.
Thursday's slaughter is estimated at 122,000 head -- 2,000 head more than a week ago and 4,000 head less than a year ago.
Boxed beef prices closed lower: choice down $1.28 ($295.39) and select down $2.49 ($285.76) with a movement of 173 loads (134.81 loads of choice, 21.34 loads of select, 3.95 loads of trim and 12.60 loads of ground beef).
FRIDAY'S CATTLE CALL: Steady to $1 higher. Feedlots seem confident they'll get higher prices for their cattle again this week, and with packers running faster chain speeds, they may just have to pay up to get the cattle they need to be committed.
FEEDER CATTLE:
The corn complex may have closed lower and summer grass country in parts of the Northwest may be getting moisture, but the feeder cattle complex still closed lower Thursday afternoon as the market lacked technical support and interest from traders. Thursday's close in the spot August contract was telling as traders allowed it to pressure last week's low, which stands as the market's current support plane. If traders elect to again pressure the market's bottom trading range on Friday, the next support point could be around $245.
There's been a light movement in the cash market in the South at $1 higher than last week's weighted average which should help encourage Friday's market -- especially if the morning's WASDE report is supportive, too. May feeders closed $1.55 lower at $238.65, August feeders closed $1.35 lower at $251.05 and September feeders closed $1.32 lower at $252.07. The CME feeder cattle index May 8: up $0.93, $240.38.
LEAN HOGS:
The lean hog complex again closed lower as pork demand neglected to substantiate throughout the day. June lean hogs closed $1 lower at $97.72, July lean hogs closed $1.40 lower at $101.05 and August lean hogs closed $1.35 lower at $100.37. The market couldn't blame a sharp decline in the belly on today's weaker close in the carcass price as the majority of cuts rounded out the day weaker. Friday morning, the latest WASDE report will be released which should help guide the market as traders are looking for direction, especially in the form of what will summer demand amount to.
Pork cutouts totaled 210.07 loads with 180.23 loads of pork cuts and 29.84 loads of trim. Pork cutout values: down $0.86, $98.43. Thursday's slaughter is estimated at 472,000 head -- 9,000 head less than a week ago and 6,000 head more than a year ago. The CME lean hog index May 7: up $0.25, $91.28.
FRIDAY'S HOG CALL: Lower. Packers were aggressive early in the week, and with pork cutout values lagging, Friday won't likely see much demand.
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