GENERAL COMMENTS:
Heading into the weekend doesn't leave livestock
enthusiasts many warm and fuzzy feelings as the board closed sharply
lower and the havoc of the coronavirus doesn't seem to be lessening. Hog
prices are lower on the National Direct Afternoon Hog Report, down
$0.77 with a weighted average of $58.07. May corn is down 2 3/4 cents
per bushel and May soybean meal is up $0.20. The Dow Jones Industrial
Average is down 493.99 points and NASDAQ is down 151.46 points.
From Friday to Friday, livestock futures scored
the following changes: April live cattle up $2.30, June live cattle down
$0.10; April feeder cattle down $0.12, May feeder cattle up $2.68;
April lean hogs down $3.13, June lean hogs down $3.70.
LIVE CATTLE:
The market's swings throughout the whirlwind of
the coronavirus have been baffling. Last week boxed beef prices and cash
prices couldn't have been anymore of polar opposites as boxed beef
prices made historical leaps and the live cattle market closed limit
lower multiple times throughout the week. Fast forward to this last
week, the board charged into Monday with ambition and a desire to regain
lost ground, cash cattle prices jumped $10.00 but then board gave way
towards the later part of the week and ultimately fell back below
Monday's open. These types of market swings are a cattleman's worse
nightmare as they undermine how the market was intended to work.
Live cattle contracts closed the week on a
disappointing note as the market fell to prices lower than Monday's
initial open. April live cattle closed $4.50 lower at $100.95, June live
cattle closed $4.12 lower at $89.42 and August live cattle closed $4.02
at $90.45. Driving support and interest seems to be half of the
market's struggles as open interest continues to dwindle and prices
follow the vicious, volatile highs and lows.
Friday's cash cattle trade didn't amount to much
as most of the week's business was already taken care of. Sales this
week in the South traded $116 to $122, $9.00 to $10.00 higher than the
previous week. And cattle in the North traded from $180 to $191, roughly
$17 higher than last week's weighted average. Friday's slaughter is
estimated at 117,000 head, 8,000 head more than a week ago and 10,000
head more than year ago. Saturday's kill is projected to be around
75,000 head.
Boxed beef prices closed mixed: choice down
$0.73 ($252.84) and select up $0.21 ($242.38) with a movement of 124
loads (72.72 loads of choice, 10.68 loads of select, 19.30 loads of trim
and 21.38 loads of ground beef).
MONDAY'S CASH CATTLE CALL: Good guess. Next week
is going to be a tough one. Cash cattle prices were higher this week,
but if the board continues to trade lower, it wouldn't be surprising to
see this week's advancements lost.
FEEDER CATTLE:
Feeder cattle contracts closed the week limit
lower throughout the entire complex. April feeders closed $4.50 lower at
$120.60, May feeders closed $4.50 lower at $120.92 and August feeders
closed $4.50 lower at $127.10. At Blue Grass Stockyards in Stanford,
Kentucky, compared to last week, feeder steers sold $10.00 to $15.00
higher with some instances of $20.00 higher. Feeder heifers sold $7.00
to $10.00 higher with some instances of $15.00 higher. Slaughter cattle
continue to sell with extremely high demand as slaughter cows sold $3.00
to $5.00 higher and slaughter bulls sold $2.00 to $4.00 higher. The CME
feeder cattle index 3/26/2020: up $1.94, $130.44.
LEAN HOGS:
Nearby lean hog contracts took full use of the
expanded limits while the rest of the deferred contracts closed $2.32 to
$3.80 lower. April lean hogs closed $4.45 lower at $58.45, June lean
hogs closed $4.50 lower at $64.25 and July lean hogs closed $3.80 lower
at $66.80. Pork cutouts total 339.93 loads with 306.22 loads of pork
cuts and 33.71 loads of trim. Pork cutout values: down $1.42, $77.61.
Friday's kill is estimated at 489,000 head, 1,000 head less than last
week but 25,000 head more than a year ago. Saturday's kill is expected
to be around 275,000 head. The CME lean hogs index 3/25/2020: up $1.02,
$66.17.
MONDAY'S CASH HOG CALL: Steady. With packers
needing readily available hogs, the cash market should stay steady with
demand as strong as it is.
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