GENERAL COMMENTS:
The livestock complex is trading mixed into Wednesday's noon hour as the lean hog complex is elated to see stronger export interest noted in the morning's WASDE report, but the live cattle complex is waiting for cash cattle trade to develop. July corn is up 4 cents per bushel and July soybean meal is up $1.90. The Dow Jones Industrial Average is up 99.20 points.
LIVE CATTLE:
The live cattle complex was trading higher through most of Wednesday morning, but with midday boxed beef prices slightly lower, traders are letting the complex drift lower. June live cattle are down $0.52 at $183.20, August live cattle are down $0.65 at $178.25 and October live cattle are down $0.72 at $181.00. The cash cattle market still hasn't seen any trade develop but asking prices have been noted in the South at $187 to $188, while asking prices in the North remain elusive. It's not likely packer interest will really develop until Thursday.
Wednesday's WASDE report was mostly favorable to the cattle and beef markets. Beef production for 2024 fell by 5 million pounds as the market is currently seeing slower chain speeds but that won't gravely affect production as heavier carcass weights will offset the market's slower throughput. Steer prices in the remaining three quarters of the year saw mostly higher price trends compared to last month's report. Steers in the second quarter of 2024 are expected to average $186 (up $2.00 from last month), steers in the third quarter are expected to average $183 (up $1.00 from last month), and the fourth quarter of 2024 is the only quarter that saw a price reduction from last month as steers are now expected to average $186 (down $1.00 from last month). Beef imports remained steady at 4,171 million pounds for 2024, and beef exports remained steady at 2,818 million pounds for 2024.
Boxed beef prices are lower: choice down $0.45 ($317.76) and select down $2.08 ($298.54) with a movement of 74 loads (39.16 loads of choice, 25.17 loads of select, zero loads of trim and 9.75 loads of ground beef).
FEEDER CATTLE:
The feeder cattle complex is trading mildly higher as the market is thankful for the support it's seen fundamentally already this week. Superior's Corn Belt Classic had an extremely strong showing which has helped keep the market's overall confidence elevated. Based on the unofficial sale averages I've seen, region two steer prices for steers weighing 500 to 740 pounds were $17 to $35/cwt more than what the sale averaged in 2023. The only weight group for the region that saw a price reduction compared to last year were the steers averaging 750 to 790 pounds, and they traded roughly $10/cwt less than a year ago. Again, these are based on the market's unofficial sale prices, but either way it's an encouraging trend to note. August feeders are up $0.17 at $257.82, September feeders are up $0.22 at $258.90 and October feeders are up $0.02 at $259.25.
LEAN HOGS:
The lean hog complex is trading moderately higher into Wednesday's noon hour as the market is encouraged to see the uptick in demand noted in the morning's WASDE report. With exports increased by 100 million pounds for 2024, traders are willing to advance the contracts upon such news. July lean hogs are up $1.45 at $93.72, August lean hogs are up $0.95 at $90.05 and October lean hogs are up $0.47 at $77.15. Yes, morning pork cutout values are down, but given the wild swings currently seen in the belly, that's expected.
Wednesday's WASDE report shared mixed results for the hog and pork markets. 2024 pork production grew by 42 million pounds as current slaughter speeds are more aggressive than originally assumed and carcass weights are heavier as well. Quarterly hog prices saw a slight reduction from last month's estimates as second quarter hog prices in 2024 are now expected to average $66 (down $2.00 from last month), third quarter hog prices are expected to average $68 (down $3.00 from last month) and fourth quarter prices were unchanged at $56.00. 2024 pork imports grew by 10 million pounds, but 2024 pork exports grew by 100 million pounds.
The projected CME Lean Hog Index for 6/11/2024 is up $0.06 at $91.38, and the actual index for 6/10/2024 is down $0.20 at $91.32. Hog prices are higher on the Daily Direct Morning Hog Report, up $1.20 with a weighted average price $87.08, ranging from $83.00 to $89.00 on 4,188 head and a five-day rolling average of $86.78. Pork cutouts total 169.57 loads with 151.96 loads of pork cuts and 17.61 loads of trim. Pork cutout values: down $3.88, $99.77.
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