Monday Midday Livestock Market Summary - Cattle Lean Into Week With Some Optimism

GENERAL COMMENTS:

Bouncing into the new week, the cattle contracts are trading surprisingly higher as the market seems to have found some support. Meanwhile, the lean hog complex isn't as sold on the notion of trending higher as the war in Ukraine unfolds minute-by-minute. May corn is down 6 3/4 cents per bushel and May soybean meal is up $1.00. The Dow Jones Industrial Average is down 680.39 points and NASDAQ is down 310.13 points.

LIVE CATTLE:

As hard as it may be to believe, the live cattle contracts are trading higher and its looking like the market aims to trend this way throughout the day. Now given the unsettled nature of the Ukraine/Russia war, anything is possible in the markets today, tomorrow, and likely for months to come. April live cattle are up $1.47 at $137.25, June live cattle are up $0.80 at $133.33 and August live cattle are up $0.55 at $134.70. It's too early to tell if a true bottom has been established in boxed beef prices, but it is interesting to note that on a Monday at midday, the cuts are showing higher price points. The cash cattle market will likely struggle this week as packers play on the market's volatility and sit cozy with cattle committed with time. It's likely this week's trade will be steady at best. New showlists appear to be mixed -- higher in Texas, but lower in Kansas and Nebraska/Colorado.

Last week's negotiated cash cattle trade totaled 75,674 head. Of that 70% (53,306 head) are committed for nearby delivery, while the remaining 30% (22,368 head) are committed for deferred delivery.

Boxed beef prices are higher: choice up $0.49 ($254.82) and select up $0.68 ($249.09) with a choice/select spread of $5.73 and a movement of 65 loads (28.53 loads of choice, 11.44 loads of select, 5.02 loads of trim and 19.96 loads of ground beef).

FEEDER CATTLE:

The feeder cattle contracts are setting out to an aggressive Monday as the market trades anywhere from $1.00 to $3.00 higher. You'd think the market would still be leery of extending itself as the corn market's deferred contracts are rallying; but applying logic to war markets doesn't always pan out. March feeders are up $2.15 at $155.25, April feeders are up $2.47 at $159.67 and May feeders are up $2.30 at $164.70. It's likely that feeder cattle/calves continue to trade lower in sale barns again this week as buyers struggle to find a place where their cost of gains make sense amid the corn market's current state.

LEAN HOGS:

The lean hog complex isn't as confident in its position as the cattle contracts are this morning. The lean hog complex's caution not only stems from war concerns, but also from the fact that pork cutout values saw pressure last week. That could be because some people are observing Lent, but it could also mean consumers thought pork prices got too high. Cash hog volumes are thin this far and likely won't be noteworthy until Tuesday or Wednesday. April lean hogs are steady at $100.45, June lean hogs are down $0.80 at $110.95 and July lean hogs are down $0.57 at $110.12.

The projected CME Lean Hog Index for 3/4/2022 is down $0.29 at $99.28 and the actual index for 3/3/2022 is down $0.13 at $99.57. Hog prices are unavailable due to confidentiality issues; however, we can see that 2,805 head have traded and the five-day moving average sits at $92.08. Pork cutouts total 178.75 loads with 153.52 loads of pork cuts and 25.23 loads of trim. Pork cutout values: up $4.62, $108.61.