GENERAL COMMENTS:
It was a lower trending day for the livestock complex as traders let the day pass by without feeling the need to jump into any of the markets. The cash cattle market remains a gamble and it's likely that trade doesn't develop until Wednesday or later this week. Hog prices closed higher on the Daily Direct Afternoon Hog Report, up $4.85 with a weighted average of $106.83 on 6,621 head. July corn is down 12 3/4 cents per bushel and July soybean meal is down $10.80. The Dow Jones Industrial Average is down 653.67 points.
LIVE CATTLE:
It was mostly a lower trending day for the live cattle complex as the June and August contracts were able to close higher but, otherwise the market kept its descend through closing. June live cattle closed $0.80 higher at $133.55, August live cattle closed $0.02 higher at $135.37 and October live cattle closed $0.25 lower at $142.62. It's a gamble on what this week's cash cattle market is going to pan out to be. Packers sit with ample supplies of cattle at this disposal, but with how fast they're running slaughter speeds, they need all the cattle they can get. New showlists appear to be somewhat lower in Kansas, but higher in Nebraska/Colorado and Texas.
Monday's slaughter is estimated at 121,000 head, 10,000 head more than a week ago and 8,000 head more than a year ago.
Last week's negotiated cash cattle trade totaled 109,180 head, which makes it the third consecutive week in a row of cash cattle trade exceeding 100,000 head. Of that, 70% (76,050 head) were committed for nearby delivery, while the remaining 30% (33,130 head) were committed for deferred delivery.
Boxed beef prices closed mixed: choice up $3.85 ($258.29) and select down $1.93 ($243.13) with a movement of 131 loads (63.28 loads of choice, 31.16 loads of select, 19.83 loads of trim and 16.60 loads of ground beef).
TUESDAY'S CASH CATTLE CALL: Steady. It's most likely that the week's cash cattle market doesn't see too much interest until Wednesday or later, but at that, point prices could trend steady or get soft as packers have bought a plethora of cattle in the last three weeks.
FEEDER CATTLE:
It was a depressing day for the feeder cattle contracts. Even though the corn market closed $0.07 to $0.13 lower in its nearby contracts, the feeder cattle market wasn't able to capitalize on the corn market's weaker day. May feeders closed $0.25 higher at $159.80, August feeders closed $0.47 lower at $174.22 and September feeders closed $0.72 lower at $177.22. The market may be able to push higher if support comes from the live cattle complex, but with the cash cattle market unsure of how this week's trade will pan out, the feeder cattle market isn't holding its breath for that support. The CME Feeder Cattle Index for May 6: up $0.70, $156.21.
LEAN HOGS:
The lean hog complex saw another day of sharp losses as the contracts traded $1.00 to $2.00 lower through closing. June lean hogs closed $2.80 lower at $101.30, July lean hogs closed $2.85 lower at $104.20 and August lean hogs closed $2.50 lower at $104.47. What was surprising to see in Monday's market was packers' aggression in the cash market. Even though pork cutout values didn't close higher, thin supplies of market-ready hogs are keeping packers on their toes and pushing them to actively seek out the cash market in order to have all the hogs they need to their nearby kills. Monday's slaughter is estimated at 468,000 head, 14,000 head less than a week ago and 9,000 head less than a year ago. Pork cutouts total 294.00 loads with 250.87 loads of pork cuts and 43.13 loads of trim. Pork cutout values: down $0.31, $104.39. The CME Lean Hog Index for May 5: down $0.05, $100.91.
TUESDAY'S CASH HOG CALL: Steady. Given that packers were aggressive in Monday's cash market, and that the market's average price jumped $4.85 from Friday, it's safe to say packers need hogs.
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