GENERAL COMMENTS:
Livestock markets closed steadily higher again on Tuesday but the biggest new of the day came that President Trump will be taking executive action to keep packing plants open. Hog prices shot higher on the National Direct Afternoon Hog Report, up $1.21 with a weighted average of $36.17 on 6,995 head sold. July corn is down 1 1/4 cents per bushel and July soybean meal is down $3.10. The Dow Jones Industrial Average is down 32.23 points and NASDAQ is down 122.43 points.
Specific details of President Trump's plan have yet to be revealed but it's understood that he will use the Defense Production Act to keep essential facilities open. As the livestock industry has been crippled by the effects of packing plants being shut down from COVID-19, this comes as fantastic news. More details will be reported when they are available.
LIVE CATTLE:
Live cattle contracts close modestly higher throughout the complex. June live cattle closed $0.65 higher at $84.70, August live cattle closed $0.12 higher at $90.52 and October live cattle closed $0.02 higher at $95.80. As seen in the lean hog contracts, steady, continual positive movements can add up over time and can be just as powerful as fast, massive movements. Given the uncertainty that the industry has faced over the last couple of months, a positive upward trend will be greatly appreciated even if it is slow moving. There was another light round of trade reported in Nebraska at $150, $4.00 lower than last week's weighted average. Trade is expected to wait until sometime after the FCE.
Tuesday's slaughter is estimated at 76,000 head, 8,000 head less than a week ago and 45,000 head less than a year ago.
Boxed beef prices close higher: choice up $18.98 ($330.82) and select up $22.10 ($320.88) with a movement of 99 loads (55.25 loads of choice, 18.84 loads of select, 11.35 loads of trim and 13.34 loads of ground beef). Not that it's uncommon anymore, but both choice and select cuts set new high standards for the new advancement on both price and gains for the day.
WEDNESDAY'S CASH CATTLE CALL: Steady. Regardless of the timeline of packing plants opening back up, there will be some short-term softness in the market as the industry has to work through the built up supply that has accumulated over the last couple of weeks.
FEEDER CATTLE:
Feeder cattle contracts closed the day higher again, ranging from $0.35 to $1.00 higher. May feeders closed $0.35 higher at $118.50, August feeders closed $0.65 higher at $127.92 and September feeders closed $0.62 higher at $129.35. As the market closes higher again, sale barns look to their large grass special sales and seem optimistic, as buyers feel more comfortable buying with the board being slightly higher.
On Monday, at Oklahoma National Stockyards in Oklahoma City, Oklahoma, compared to last week, feeder steers sold steady to $4.00 lower. Feeder heifers sold $1.00 to $2.00 lower, except 800 to 900 pound heifers which sold $2.00 to $5.00 higher. The feeder market improved as the day progressed and the board closed higher. Steer calves sold $4.00 to $8.00 lower but weighs under 450 pounds were lightly tested. Heifer calves sold $4.00 to $10.00 lower, except anything over 500 pounds sold steady to $3.00 lower. The CME feeder cattle index 4/27/2020: down $1.03, $118.69.
LEAN HOGS:
Lean hog contracts stormed through Tuesday's closing higher on the board and in the cash market as well. June lean hogs closed $0.92 higher at $56.20, July lean hogs closed $1.82 higher at $60.25 and August lean hogs closed $1.65 higher at $63.72. The market closed lower than it had traded for earlier in the day but still closed higher than Monday's close. The simultaneous movement from the board and from the cash market is extremely bullish as both markets need to work together. Pork cutouts total 299.53 loads with 277.54 loads of pork cuts and 21.98 loads of trim. Pork cutout values: up $4.78, $88.49. Tuesday's slaughter is estimated at 283,000 head - 71,000 head less than a week ago and 188,000 head less than a yea ago. The CME lean hog index 4/24/2020: up $1.26, $48.98.
WEDNESDAY'S CASH HOG CALL: Steady to slightly higher. The announcement from President Trump that packing plants will be back up and running soon is a strong, bullish indication for the market.
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