GENERAL COMMENTS:
It was another strong day for the live cattle and feeder cattle contracts Wednesday, as both markets saw higher closes on the board, and the cash cattle market walked away with higher prices too. Heading into Thursday's market, hog enthusiasts aren't expecting to see much in the export report, but cattle producers are hoping strong demand prevails. Hog prices closed lower on the Daily Direct Hog Report, down $1.88 with a weighted average of $97.79 on 6,187 head. May corn is up 7 1/4 cents per bushel, and May soybean meal is down $2.70. The Dow Jones Industrial Average is up 344.23 points.
LIVE CATTLE:
What a week! There's power in having tight showlists and having regional packers who need to get business done -- all of which highlights the fact that more regional packers would be a great addition to the industry. The futures market had another whammy of day, as the spot June contract closed above the 40-day moving average and saw its third consecutive day of higher trade. April live cattle closed $0.67 higher at $140.62, June live cattle closed $0.57 higher at $136.87, and August live cattle closed $1 higher at $138.65. The most impressive business of the day's trade was the business that took place in the North. Dressed cattle traded anywhere from $224 to $231, mostly at $225 to $227 which is easily $2 to $4 higher than last week's business. Another round of light trade developed in the South at $139, which is $1 higher than last week and steady with the week's trend. Wednesday's slaughter is estimated at 126,000 head -- 1,000 head more than a week ago and 10,000 head more than year ago.
The Fed Cattle Exchange Auction listed a total of 3,596 head, of which 150 head actually sold, none were scratched from the auction, and 3,446 head were listed as unsold, as they did not meet the reserve prices, which ranged from $132 to $144. Opening prices ranged from $130 to $138, high bids ranged from $137.50 to $139.50. The state-by-state breakdown looks like this: Texas 1,323 total head, with 150 head sold at $137.50 to $139, 1,173 head went unsold; California 70 total head, all of which went unsold; Nebraska 480 total head, all of which went unsold; Iowa 1,723 total head, all set for delayed delivery (May 21 to June 3) these cattle had a reserve price of $5 per cwt, with opening bids of $1 per cwt. None of these cattle sold.
Boxed beef prices closed lower: choice down $1.11 ($272.36) and select down $1.34 ($259.37) with a movement of 149 loads (98.90 loads of choice, 25.31 loads of select, 9.89 loads of trim and 14.46 loads of ground beef).
THURSDAY'S CASH CATTLE CALL: Steady with the week. Given that cattle have traded in both regions, it's likely that prices stay with the week's trend.
FEEDER CATTLE:
The corn market traded mostly steady Wednesday, which added no pressure to the feeder cattle complex. And with the immense support that's stemming from the live cattle market, the feeder cattle complex had no problem trading higher through Wednesday's close. May feeders closed $1.02 higher at $161.95, August feeders closed $0.67 higher at $174.42, and September feeders closed $0.57 higher at $178. Sales in the Northern part of the U.S. are noting small runs, as getting cattle to the sale this week is difficult amid the storm that's blowing across the country. At Winter Livestock Auction in La Junta, Colorado, compared to last week's sale, feeder steers weighing 650 to 700 pounds traded $1 to $2 lower, and steers over 700 pounds traded steady to $2 lower. Feeder heifers weighing 700 to 750 pounds traded $3 to $5 lower, and heifers over 750 pounds traded steady. Slaughter cows traded steady to $1 lower, and slaughter bulls sold mostly steady. The CME feeder cattle index 4/12/2022: up $0.05, $155.86.
LEAN HOGS:
Despite the cash market seeing a significant movement and pork cutouts seeing an uptick in price, the lean hog complex ran out of gas when it came to Wednesday's market and ultimately rounded out the day fully lower. June lean hogs closed $0.87 lower at $117.60, July lean hogs closed $0.72 lower at $119.10 and August lean hogs closed $0.42 lower at $117.85. Pork cutouts saw mostly modest gains across the board, but the belly took the cake again Wednesday, as it closed $7.47 higher at $189.25. The market doesn't expect to see much noteworthy news in Thursday's export report, but as always, we'll be watching for it to see if any significant business took place. Pork cutouts totaled 256.44 loads with 231.49 loads of pork cuts and 24.95 loads of trim. Pork cutout values: up $1.73, $108.53. Wednesday's slaughter is estimated at 478,000 head -- 27,000 head more than a week ago and steady with a year ago. Tuesday's hog slaughter was revised to 467,000 head -- 6,000 head less than what was originally stated. The CME lean hog index 4/11/2022: down $0.53, $99.10.
THURSDAY'S CASH HOG CALL: Steady to somewhat lower. Given that the week is winding down ahead of the Easter holiday, it's unlikely that packers pay the cash hog market too much attention.
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