GENERAL COMMENTS:
The market doesn't like surprises; if higher prices come with the surprises, then at least cattle futures can celebrate in the moment. With corn prices continuing to rally, cattle futures were expected to continue to trade fully lower. But with the volatile nature of high prices comes lofty price swings, which the market is seeing in Tuesday's trade in both the cattle and lean hog contracts. July corn is up 2 cents per bushel and July soybean meal is down $2.10. The Dow Jones Industrial Average is down 13.12 points and NASDAQ is down 24.30 points.
LIVE CATTLE:
Live cattle futures are catching a new wind of optimism and they're fully enjoying Tuesday's higher trade after last week's sharp decline. The entire live cattle complex is rallying and with midday boxed beef prices more than $4.00 higher for both choice and select cuts, the cash cattle market could grow more confident in at least demanding steady money. June live cattle are up $0.50 at $116.77, August live cattle are up $0.40 at $118.35 and October live cattle are up $0.47 at $123.25. The June live cattle contract seems to want to stay above $116.00 for now and if boxed beef prices can keep shining through and showing stellar demand, traders may feel as if the market's given enough at this point. The cash cattle market is still quiet without any bids or asking prices at this point.
Boxed beef prices are sharply higher: choice up $4.52 ($289.72) and select up $4.81 ($279.16) with a movement of 72 loads (42.58 loads of choice, 7.83 loads of select, 9.47 loads of trim and 11.69 loads of ground beef).
FEEDER CATTLE:
Even though corn futures are still rallying, traders are eyeing cattle futures after their lower trade over the last month and feel as if the market is safe enough to invest in again. At some point, corn's high price point will be its own demise, and with traders feeling more and more comfortable with both the feeder cattle contracts, that demise may be nearing. May feeders are up $0.10 at $137.37, August feeders are up $1.07 at $151.37 and September feeders are up $1.30 at $153.57.
LEAN HOGS:
Lean hog futures rallied full force through Monday's trade, but Tuesday the complex has fought some leeriness in the nearby contracts even though fundamentals are fully supportive of higher trade. June lean hogs are down $0.15 at $106.70, July lean hogs are down $0.25 at $105.42 and August lean hogs are down $0.10 at $102.20. With both pork cutouts higher and the cash market, higher the day simply needs to see this type of energy and optimism carry through the day's end in order to feel comfortable trading higher Wednesday. Monitoring Tuesday's slaughter speeds will again be vital as it could be an indication as to how aggressive packers are going to be in the cash market.
The projected CME Lean Hog Index for 4/26/2021 is up $0.22 at $107.39, and the actual index for 4/23/2021 is up $0.66 at $107.17. Hog prices are sharply higher on the National Direct Morning Hog Report, up $4.06 with a weighted average of $110.95, ranging from $104.50 to $116.50 on 5,090 head and a five-day rolling average of $106.93. Pork cutouts total 241.50 loads with 215.48 loads of pork cuts and 26.02 loads of trim. Pork cutout values: up $2.97, $112.27.
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