GENERAL COMMENTS:
Lean hog futures are taking Tuesday by storm and the feeder cattle contracts are growing founder of the idea, but the live cattle futures cannot muster up the support necessary to trade higher. With there being so much disarray between the live cattle futures and cash market, traders aren't comfortable with the marketplace and are keeping a far distance from its trade. May corn is up 2 1/2 cents per bushel and May soybean meal is down $1.20. The Dow Jones Industrial Average is down 131.49 points and NASDAQ is up 112.30 points.
LIVE CATTLE:
While the feeder cattle contracts are toying with the idea of trading higher and the lean hog contracts are trading fully higher, the live cattle contracts just can't get on board with the idea. April live cattle are down $0.60 at $118.52, June live cattle are down $0.70 at $121.07 and August live cattle are down $0.12 at $120.72. With there being so much disconnect between the cash market and the futures, there's a lot of turbulence that could happen in the live cattle market in the near future. Feedlots are hopeful the cash cattle market will strengthen its position and in a short time be trading close to where the April board is trading now ($118 to $119) but with the uphill battle they've recently been fighting they aren't holding their breath. The countryside is still quiet without bids surfacing. Asking prices in the South are noted at $116 to $117 and the North has yet to disclose their prices. I'm keeping my fingers crossed that the day will come and pass without any cash cattle trade developing and later in the week feedlots can get their full asking price out of packers as they've had to wait until later in the week to procure cattle.
Boxed beef prices are higher: choice up $1.76 ($226.53) and select up $0.73 ($218.78) with a movement of 56 loads (32.61 loads of choice, 12.61 loads of select, zero loads of trim and 10.50 loads of ground beef).
FEEDER CATTLE:
Feeder cattle futures are unfortunately back to trading mostly lower even though the corn market is giving the feeder market another chance to scale higher. But without trader interest the complex has no option but to scale lower. March feeders are down $0.02 at $137.00, April feeders are down $0.32 at $143.60 and May feeders are up $0.07 at $149.75. The complex isn't trading sharply lower and there's a good chance that if corn prices keep trading red throughout the day the feeder cattle contracts could see some support develop and potentially trade higher before the close.
LEAN HOGS:
As anticipated, the lean hog futures contracts are back to trading significantly higher upon seeing Monday's strong demand. April lean hogs are up $2.12 at $92.67, June lean hogs are up $1.77 at $100.70 and July lean hogs are up $1.20 at $100.80. With Monday's strong close all across the fundamental spectrum -- pork cutouts closed higher, the cash hog market was $3 higher and hog slaughter continues to run vigorously -- Tuesday's lean hog market has again shot higher to keep up with the market's speed. Tuesday's rally has sent nearly all of the of the nearby contracts to new life-of-the-contract highs, and if Tuesday's market can close with strong fundamental backing again, the market should be paving the way for a stronger marketplace come Wednesday. Technically speaking, the market is vulnerable; but with demand continuing to pour into the market, the contracts keep scaling higher, and higher, and higher yet again.
The projected CME Lean Hog Index for 3/15/2021 is up $0.56 at $89.91, and the actual index for 3/12/2021 is up $0.95 at $89.35. Hog prices are higher on the National Direct Morning Hog Report, up $0.32 with a weighted average of $85.77, ranging from $85.01 to $91.00 on 4,050 head and a five-day rolling average of $84.78. Pork cutouts total 233.04 loads with 217.71 loads of pork cuts and 15.33 loads of trim. Pork cutout values: up $1.11, $103.55.
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