GENERAL COMMENTS:
Heading into the weekend, livestock participants are going to be carefully watching slaughter speeds, Trump's relations with China and cash cattle prices. Hog prices were lower on the National Direct Afternoon Hog Report, down $0.42 with a weighted average of $36.92 on 5,578 head sold. July corn is down 1 3/4 cents per bushel and July soybean meal is down $1.10. The Dow Jones Industrial Average is down 17.53 points and NASDAQ is up 120.88 points.
From Friday to Friday, livestock futures scored the following changes: June live cattle up $2.03, August live cattle up $2.28; August feeder cattle up $6.55, September feeder cattle up $5.60; June lean hogs down $1.93, July lean hogs up $1.13.
LIVE CATTLE:
Live cattle contracts closed with losses greater than $1 throughout the complex. June live cattle closed $1.75 lower at $99.72, August live cattle closed $1.57 lower at $99.60 and October live cattle closed $1.37 lower at $101.42. For the market's moral, it was energizing to see the nearby contracts trade above $100 earlier this week, but heading into the first week of June, all eyes are going to be on cash cattle prices. As packers continue to work on the backlog of cattle, and as boxed beef prices drop, which cuts away at packer's profits, the elevated cash cattle bids will most likely weaken in the near future. There was another round of light cash cattle trade through Friday, all within the ranges established earlier in the week. Live cattle sold for $115 to $120 and dressed cattle traded for $174 to $190 this week.
Friday's slaughter is estimated at 111,000 head, 9,000 head more than a week ago and 13,000 head less than a year ago. Saturday's slaughter is projected to be 83,000 head.
Boxed beef prices closed lower: choice down $6.22 ($363.34) and select down $4.02 ($340.07) with a movement of 115 loads (54.29 loads of choice, 19.87 loads of select, 22.00 loads of trim and 18.89 loads of ground beef).
MONDAY'S CASH CATTLE CALL: Steady. Seeing that packers have the Department of Justice hot on their case, they are going to be more active in the cash cattle market than what would historically take place. Its inevitable that cash prices will weaken, but whether that's next week or sometime later in June is hard to pinpoint.
FEEDER CATTLE:
Feeder cattle contracts closed lower but felt more pressure in deferred contracts than nearby contracts. August feeder cattle closed $0.15 lower at $135.35, September feeder cattle closed $0.50 lower at $135.75 and October feeder cattle closed $0.75 lower at $136.02. Heading into the upcoming weeks, feeder cattle prices will be very watchful of how cash cattle trades.
At Mitchell Livestock Auction in Mitchell, South Dakota, compared to last week, a higher undertone was noted on steers that weighted up to 700 pounds. Steers weighing 700 to 1000 pounds were $3.00 to $9.00 higher, steers over 1000 pounds were $3.00 higher. An unevenly steady undertone was noted on heifers up to 700 pounds. Heifers weighing 700 pounds and up were $1.00 to $3.00 higher. Demand was excellent and there were many load lots in the offering. The CME feeder cattle index 5/28/2020: unavailable at this time.
LEAN HOGS:
Lean hog contracts surprised everyone after the noon hour as contracts took a turn and closed the day higher. Feeling anxious about Trump's announcements Friday afternoon, the market performed cautiously but was able to ultimately close higher. June lean hogs closed $0.07 lower at $56.85, July lean hogs closed $1.37 higher at $57.02 and August lean hogs closed $1.70 higher at $56.72. Pork cutouts had a huge day, totaling 544.45 loads with 499.25 loads of pork cuts and 45.19 loads of trim. Pork cutout values: down $1.26, $88.20. Friday's slaughter is estimated at 414,000 head, 34,000 head more than a week ago and 59,000 head less than a year ago. Saturday's slaughter is projected to be 302,000 head. The CME lean hog index 5/27/2020: up $0.42, $62.95.
MONDAY'S CASH HOG CALL: Lower. Built up supply will continue to pressure the market until thoroughly processed through.
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