Cattle futures trade resembled a game of "whack-a-mole" Friday as short bursts of buying posted gains. But this was followed by a firm beat down as sharp losses developed in most contracts at the closing bell. The narrative has not changed through the week, with the focus on potential coronavirus impact to domestic and global economies and buying habits heavily affecting livestock trade. Hog prices are higher on the National Direct Afternoon Hog Report, up $0.25 with a weighted average of $50.59. May corn is up 1/4 cent per bushel and May soybean meal is up $2. The Dow Jones Industrial Average is down 797.94 points and NASDAQ is down 153.62 points.
From Friday to Friday, livestock futures scored the following changes: Feb Live cattle off $7.02, Apr Live cattle off $10.68; Mar Feeder cattle off $8.92, Apr Feeder cattle off $9.40; Apr Lean hogs off $4.75, May Lean hogs off $5.00.
Glimmers of hope developed through the Friday trading session as traders adjusted positions at the end of the month despite remaining on the "coronavirus fear" roller coaster. February futures expired, sparking single-digit gains, while the rest of the complex posted sharp losses. Markets closed $2.90 lower to 7 cents higher Friday afternoon. The lack of understanding of how or when any impact from coronavirus will have on beef demand or overall consumer habits kept most markets with active losses at the end of the week. April live cattle are down $1.90 at $107.57, June live cattle are down $2.72 at $101.20 and August live cattle are down $2.20 at $102.27. Following early week trade in all areas, little to no interest was seen Friday in cash cattle markets. Given the strong downward pressure seen in cash trade -- while futures continue to wither away -- is limiting both sides incentive to step into the market. Activity is not expected to be significant until midweek next week as Monday's focus will be on show list distribution and inventory needs, while trying to assess the overall market direction going forward.
Boxed beef prices closed lower: choice down $0.24 ($205.30) and select down $0.78 ($198.91) with a movement of 104 loads (58.22 loads of choice, 14.86 loads of select, 8.67 loads of trim and 21.97 loads of ground beef). Thursday's slaughter is estimated at 115,000 head, 6,000 lower than a week ago and 2,000 head lower than a year ago.
MONDAY'S CASH CATTLE CALL: Steady. Even if continued pressure develops in futures trade, Monday activity is expected to be reserved for inventory taking and show list distribution as both sides assess further market direction during early March.
Feeder cattle contracts recovered a little piece of the market as the day's end neared. Contracts closed $1.30 to $2.02 lower Friday. March feeders are down $1.30 at $131.27, April feeders are down $1.37 at $132.70 and May feeders are down $2.02 at $133.52. Friday trade posted back and forth moves as traders focused on the general underlying bearish tone that has continued all week, but attempts to cover positions at the end of the week and month allowed for momentums of higher trade during the day. With sharp losses seen at the closing bell, the underlying pressure remains strong through cattle trade going into the month of March.
Lexington livestock market in Lexington Ne, reported 2,394 head for the week with steers selling $1 to $6 per cwt lower than last week, while heifers sold $1 to $4 per cwt lower. The CME feeder cattle index 2/27/2020: not available at this time.
Lean hog futures were the most stable of all livestock markets with nearby futures holding the best; the complex ranging from $0.27 to $1.30 per cwt losses. The most aggressive pressure developed in summer and fall contracts as traders continue to feel that the most aggressive global demand pressure will develop in the last half of 2020. April lean hogs are down $0.27 at $62.27, June lean hogs are down $0.82 at $77.22 and July lean hogs are down $1.10 at $78.30. The continued ability for cash hog prices and pork values to remain generally stable through the end of February is an impressive feat given widespread moves in futures trade through the end of the month. Pork cutouts values are unavailable at this time due to reporting delays. Friday's slaughter is estimated at 486,000 head, 6,000 head less than a week ago and 3,000 head less than a year ago. Estimated weekly slaughter is 2.65 million head. The CME lean hog index 2/26/2020: down $0.05, $56.36.
MONDAY'S CASH HOG CALL: Steady to firm. Limited direction is expected in cash hog prices as traders return from the weekend. The need to fuel a full week of aggressive packer activity will likely keep prices steady to firm.