Friday Closing Livestock Market Summary

GENERAL COMMENTS

The cash cattle trade was not tested Friday, thanks to ambitious business achieved on Wednesday. Trade volume totals for the week look decent, surely large enough to keep feedlots current. The national hog base closed up $0.43 compared with the prior day settlement ($57.00-$66.00, weighted average $64.20). From Friday to Friday, livestock futures scored the following changes: Jun LC Up $4.28; Aug LC up $1.12; May FC Off $5.78; Aug FC Off $1.28; Jun LH Up $2.32; Jul LH Up $1.60. Corn futures closed generally 4 cents higher supported by short-covering and wet planting conditions in parts of the Eastern Corn Belt. The stock market closed higher with the Dow up 55 and the Nasdaq better by 25.

LIVE CATTLE

Futures closed sharply lower, off 192-300. The late-week price collapse seemed to be fueled by aggressive long liquidation and technical selling. Charts came into Friday looking very overbought and due for some kind of correction. Furthermore, Thursday's reversal from early session highs clearly made some traders nervous about the possibility of a seasonal top. Yet despite Friday's sell-over, the trend remains definitely higher. Beef cut-outs: sharply higher (choice, $238.87 up $3.29, select $219.57 up $2.73) on moderate to good demand and light offerings (29 loads of choice cuts, 21 loads of select cuts, 06 loads of trimmings, 19 loads of coarse grinds).

MONDAY'S CASH CATTLE CALL:

Steady to $2.00 higher. Monday's market will be typically slow with packers limiting efforts to the collection of new showlists. Our guess is that the early May offering will be steady to somewhat larger than last week. Needless to say, both buyers and sellers will be watching the board closely for signs of either price stability or further weakness.

FEEDER CATTLE

Futures closed sharply lower, off 427-450. Feeders closed sharply lower, suffering from the same high level of liquidation seen in the live market. The big question is whether Thursday's peak high represents a tombstone for the market or simply a much -needed resting spot. Like their live counterparts, feeders found themselves extremely overbought and in need of technical correction. CME cash feeder index: 05/04: $145.75, up $0.36.

LEAN HOGS

Futures closed mixed, up 40 to off 52. Compared with the black-and-blue cattle complex, lean hog futures Friday look like the Rock of Gibraltar. Mixed settlements in light trade volume suggested little more than pre-weekend positioning. Generally speaking, summer contracts firmed this week thanks to evidence of tightening market hog supplies and stronger cash action. Pork cut-out: $77.74 (FOB Plant) up $1.22. CME cash lean 05/03: $62.24, up $1.10 (DTN Projected lean index for 05/04: $63.55, up $1.31).

MONDAY'S CASH HOG CALL

Steady to $1.00 higher. Look for hog buyers to resume firm bids on Monday, perhaps anticipating both tightening hog supplies and firming carcass value.