GENERAL COMMENTS:
It was a dynamite day for the cattle complex as both the live cattle and feeder cattle markets were able to close sharply higher, but the lean hog complex struggled once again. Monitoring demand for both the cattle and hog markets will be essential this week and will likely gravely affect the market's direction for both sectors. Hog prices closed higher on the Daily Direct Afternoon Hog Report, up $2.60 with a weighted average price of $88.58 on 2,460 head. July corn is up 3 cents per bushel and July soybean meal is up $7.30. The Dow Jones Industrial Average is up 69.05 points.
LIVE CATTLE:
The live cattle complex saw tremendous support throughout the day and was able to close fully higher Monday afternoon with most of the contracts advancing by at least $2.00. Traders jumped into Monday's market full of excitement and eagerness to advance the market as they saw the efforts that feedlot managers exerted late last week in their attempt to hold the cash market as close to steady as possible. June live cattle closed $1.75 higher at $183.92, August live cattle closed $2.80 higher at $179.97 and October live cattle closed $2.50 higher at $182.17. New showlists appear to be mixed: higher in Texas, but lower in Kansas and Nebraska/Colorado. Monday's slaughter is estimated at 121,000 head -- 1,000 head more than a week ago and 1,000 head less than a year ago.
Last week Southern live cattle traded anywhere from $184 to $190, but mostly at $185, which is just $1.00 lower than the previous week's weighted average. Northern dressed cattle traded from $298 to mostly $301, which is $1.00 lower than the previous week's weighted average. Last week's negotiated cash cattle trade totaled 64,120 head. Of that 81% (52,096 head) were committed to the nearby delivery while the remaining 19% (12,024 head) were committed to the deferred delivery.
Boxed beef prices closed mixed: choice up $0.67 ($317.42) and select down $0.10 ($301.04) with a movement of 109 loads (49.56 loads of choice, 33.42 loads of select, 4.25 loads of trim and 21.32 loads of ground beef).
TUESDAY'S CATTLE CALL: higher. With packers only getting 52,000 head bought last week, they're likely short bought heading into this week's trade.
FEEDER CATTLE:
It was a rejuvenating day for the feeder cattle complex as the market closed mostly $3.00 higher. Fueled by feedlots' willingness to go toe to toe last week with packers, and with the belief that strong market fundamentals could keep the complex trading steady/somewhat higher again this week pushed traders to aggressively support the market. August feeders closed $3.72 higher at $258.65, September feeders closed $3.87 higher at $259.72 and October feeders closed $3.75 higher at $260.20. Today Superior Livestock Auction hosted the first day of their Corn Belt Classic video sale, and by the few lots that I watched sell, prices seemed to be strong. The sale was cataloged to sell 160,000 head and will continue through Tuesday. At Joplin Regional Stockyards in Carthage, Missouri compared to last week and at their midsession point, feeder steers under 750 pounds were selling steady but the heavier-weighted steers were selling $3.00 higher. Feeder heifers were trading anywhere from $6.00 lower to $2.00 higher. Feeder cattle supply over 600 pounds was 60%. The CME feeder cattle index 6/7/2024: not available at this time.
LEAN HOGS:
It was another day of weaker closes for the lean hog complex as the market wasn't able to use Friday's higher close as a springboard heading into the new week. Yes, cash prices closed higher, but with pork cutout values still lagging, traders weren't willing to advance the market. July lean hogs closed $0.60 lower at $92.90, August lean hogs closed $1.45 lower at $90.22 and October lean hogs closed $1.32 lower at $77.77. Pork cutouts totaled 299.97 loads with 248.86 loads of pork cuts and 51.11 loads of trim. Pork cutout values: down $0.48, $100.43. Monday's slaughter is estimated at 471,000 head -- 12,000 head less than a week ago and 13,000 head more than a year ago. The CME lean hog index 6/6/2024: down $0.17, $91.75.
TUESDAY'S HOG CALL: Steady. Given that packers had to actively procure hogs in Monday's cash market likely means that they're short bought and may have to be aggressive again in Tuesday's market.
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