GENERAL COMMENTS:
From Friday to Friday, livestock futures scored the following changes: April Live cattle off $6.20, June Live cattle off $6.65; April Feeder cattle off $7.50, May Feeder cattle off $10.30; April Lean hogs up $0.67, June Lean hogs off $4.23; April Pork cutout off $0.42, May Pork cutout unchanged.
Livestock markets were hit hard once again Friday following aggressive market pressure in nearly all commodity market sectors. The corn complex seems to be the only actively traded commodity market that avoided aggressive losses on Friday and through the end of the week. Not only did aggressive liquidation develop in stock markets, but energy markets also continued lower with crude oil futures falling $4 per barrel and Gold falling over $63 per ounce. All livestock futures hit daily trading limit losses throughout the day, allowing for expanded trade limits Monday. Continued concern about how tariffs will impact the economy and how China's announcement of countermeasure tariffs will further escalate the situation has traders beyond nervous heading into the weekend. Hog prices closed lower on the Daily Direct Afternoon hog report, down $0.27 with a weighted average of $87.4 on 2,167 hogs. May corn closed up 2 3/4 at $4.603 and May soybean meal closed down $4.90 at $283.1. The Dow Jones Industrial Average is down 2,231.07 at 38,314.86.
LIVE CATTLE:
Live cattle futures turned sharply lower once again Friday. June and October contracts closed limit lower with losses of $6.50 per cwt Friday afternoon. This was enough to allow the entire complex to have expanded trade limits in place Monday morning. The new trading limit for Monday will be $9.75 per cwt. April live cattle futures which were making history just days ago with prices above $210 per cwt, are now only $2.65 per cwt above the $200 per cwt mark. All other contracts have moved below the $200 threshold once again, creating concern about additional liquidation developing across the entire complex in the days and weeks to come. Nearby contracts are still hovering above the 40- and 100-day moving averages, but these trigger points in the market are far from safe following the aggressive market pressure seen through the last half of the trading week. Nearby contracts have plummeted $8 to $9 per cwt over the past two trading sessions, leading to more concern in all segments of the market. Cash cattle markets posted additional activity Friday afternoon with light trade developing in most areas today with Southern live deals marked at mostly $208, $1 to $2 lower than last week's weighted averages. Northern dressed business was done at mostly $335, $4 lower than last week's weighted averages. (Majors paid mostly $335, while a Regional paid as much as $345, steady with last week's wide range of sales). April live cattle closed $5.43 lower at $202.625, June live cattle closed $6.50 lower at $198.20 and August live cattle closed $6.48 lower at $194.7.
Friday's slaughter is estimated at 109,000 head, 2,000 head more than a week ago and 7,000 head less than a year ago.
Boxed beef prices closed lower: choice down $1.53 ($338.37) and select down $0.99 ($317.84) with a movement of 131.32 loads (91.79 loads of choice, 15.50 loads of select, 7.99 loads of trim and 16.04 loads of ground beef).
MONDAY'S CATTLE CALL: Steady to $2 Lower. Early week activity is expected to remain at a complete standstill, which will hopefully give both sides time to reassess the overall market direction. The sharp losses in futures trade are likely to put a negative spin on cash values, at least for the short term.
FEEDER CATTLE:
Feeder cattle posted aggressive losses for the second straight trading session Friday. All but April and March 2026 contract months closed locked in limit lower trade of $8.25 per cwt. This move will expand trading limits Monday to $12.25 per cwt creating additional uncertainty and volatility through the market. Over the past two trading sessions, nearby feeder cattle futures have erased nearly all of the gains seen during the month of March. The 40-day moving average, which seemed a safe floor just two days ago has been breached in actively traded May contracts, with most nearby contracts approaching this trigger point at the end of the week. The hope is that the weekend break will allow for a calming effect before markets open Monday morning, but weekends can be tricky as market sediment can easily move in either direction in the absence of additional trade activity during weekend breaks. April feeders closed $5.98 lower at $279.425, May feeders closed $8.25 lower at $274.875 and August feeders closed $8.25 lower at $281.05. The CME Feeder Cattle Index for April 2: up $0.02, $291.95.
LEAN HOGS:
Lean hog futures followed the rest of the livestock markets, and most other markets lower Friday as traders remain extremely concerned about future demand. April contracts were lightly traded and ended unchanged as the current tariff levels do not impact immediate activity, but the rest of the complex posted aggressive losses. June and July futures closed $4 per cwt lower, which is the daily trading limit. Closing locked limit down for the day will cause expanded trading limits to be in effect for Monday. This will put Monday's trading limit for all lean hog futures trade at $6 per cwt. The hope is that emotions and trader activity will calm slightly over the weekend break, allowing for markets to take a more levelheaded approach early next week. But every time expanded limits are enacted, the potential for even more active liquidation exists. April lean hogs closed steady, May lean hogs closed $3.45 lower at $85.125 and June lean hogs closed $4.00 lower at $91.55. Friday's hog slaughter is estimated at 486,000 head, 15,000 head more than a week ago and 4,000 head more than a year ago. Pork Cutouts totaled 346.24 loads with 304.09 loads of pork cuts and 42.15 loads of trim. Pork cutout values are up $0.64 at $94.34. The CME Lean Hog Index for April 2: down $0.08, $88.72.
MONDAY'S HOG CALL: Steady. Sharp losses in futures trade and expanded trade limits Monday could add increased volatility to the complex, but packers continued need for short-term demand is likely to keep cash values from moving significantly lower in the immediate future.
No comments:
Post a Comment