GENERAL
COMMENTS: From Friday to Friday, livestock futures scored the following
changes: August live cattle up $2.65, October live cattle up $2.66,
August feeder cattle up $1.98, September feeder cattle up $2.00, July
lean hogs up $0.03, August lean hogs up $1.05. During the last half of
this holiday week, cash cattle business was conducted mostly steady with
last week at $109 (live). Dressed business at $180 was generally $1 per
cwt higher than last week. Corn futures closed 1 penny higher, but the
soybean complex experienced losses Friday, including July soybean meal
down $2.20. The stock market (S&P 500) closed down 5 points Friday
but netted weekly gains, including a fresh all-time high Wednesday.
LIVE CATTLE: There wasn't much enthusiasm for
conducting cash cattle business late this week when everyone preferred
to be lighting off fireworks or enjoying time on a lake instead. Live
prices transacted on Wednesday were seen at $109, fully steady with last
week, while dressed business at $180 in most areas was generally $1 per
cwt higher. Total volume in the livestock futures market painted a
similar picture: declining participation throughout the week. Friday's
gains of $1.55 to $1.77 in the nearby live cattle contracts should
therefore not be attributed much significance, having taken place during
sparse and spotty trade. Beef cut-outs were lower Friday on light
demand and moderate-to-heavy offerings (109 total loads of cuts,
trimmings, and grinds), seen at $217.67 choice (down $1.58) and $194.80
select (down $0.56).
MONDAY'S CASH CATTLE CALL: Steady. Monday
activities are typically limited to the collection of new showlists. We
look for the offering to be steady around $109 live/$180 dressed.
FEEDER CATTLE: Feeder cattle futures moved
higher Friday alongside gains in live cattle, but there was enough
trend-based selling pressure to keep prices below $139 all through the
October contract by the time the session closed. Given the steady
pattern of rain showers seen all across cattle country over the past
week, pasture and range conditions are expected to once again be
beautiful in next week's Crop Progress report. CME cash feeder index for
7/4/19: $133.21, down $1.19.
LEAN HOGS: Hog slaughter has been running at
upwards of 470,000 head per day lately, demonstrating the country's
record-large supply, and the U.S. consumer hasn't been putting enough
bacon on their Fourth of July grilled hamburgers in order to tighten up
the market scenario for the overall pork cutout. Bellies have declined
more than $5 per cwt over the past week and continued their slide Friday
(down $0.79, to $98.28). Steep losses in lean hog futures Friday (down
$1.425 in the July and down $2.725 in the October contract) sent the
charts back on the downward trend they've been pursuing since
mid-April's demand-rationing prices. Pork cut-out: $73.17, up $1.69.
Updated CME cash lean index values aren't available due to packer
submission issues since the 7/2 value: $73.22.
MONDAY'S CASH HOG CALL: Steady to $1 lower. Hog
buyers are expected to resume work Monday with full knowledge that the
market is in a bearish supply scenario.
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