Cash cattle activity last week developed late Friday afternoon, going into the evening, with prices steady with the week before. Live trade developed at $125 per cwt in the South while dressed trade in the North was seen at $199 to $200, mostly at $200, again fully steady with the previous week. Both sides started over again Monday with showlists mixed, although bids and asking prices are yet to develop, and will not likely develop until midweek or later. Futures are expected to remain mixed in limited trade. The sharp pressure in feeder cattle trade late last week will be watched in morning trade as traders are expected to be focusing just as much or more on outside market direction than any development in beef fundamentals.
Cash market direction is expected to follow in line with previous market activity with ample hogs available at the packers' disposal. This may limit additional activity with packers ramping up for a full week of processing, with early bids expected steady to $1 per cwt lower, while most bids are called steady to weak. Spillover buyer support from Friday's gains may attempt to trickle into the complex, but traders are going to be closely monitored, as another swift move higher may help to break the weaker cycle in the hog complex the last month. Slaughter runs are expected at 477,000 head Tuesday.
| BULL SIDE | BEAR SIDE |
Firm renewed support in beef values Monday with Select values moving $2.01 per cwt higher is expected to spark renewed activity Tuesday.
| Sharp losses in feeder cattle trade last week is causing follow-through concern through the complex, and may limit buying early in futures trade in all cattle markets. |
| Feedlot managers are expected to focus on steady to higher cash markets the next few days, building on the stability in cash trade last week while firm wholesale beef cuts starting to build momentum through the complex. | The weather conditions continue to remain a challenge for feedlots with consistent snow storms every couple of days making lot conditions challenging and limiting efficient gains, delaying the ability to move cattle to market due to lighter gains in the last month. |
| Strong gains late last week in futures trade is adding some renewed confidence through lean hog futures. This may help to spark additional buyer activity through the complex. | Pork cutout values started the week lower with aggressive losses in rib and belly cuts. With belly primal cuts falling $5.78 per cwt, renewed pork support is limited. |
| Optimism concerning a trade agreement with China as talks continue to be planned through the week is likely to create a firm undertone to the complex. | Another round of winter weather is expected to start working through the Midwest late Tuesday. This is likely to add more disruptions due to road conditions and cold weather that will limit not only transportation but employee availability at plants. |
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| #completecalfcare |
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