GENERAL COMMENTS:
It was a tough day to start the week following the long Memorial Day weekend, as the livestock complex and futures market was bearish. Heading into Wednesday's market, packer interest should grow stronger and cattle could begin to trade. Hog prices closed higher on the Daily Direct Afternoon Hog Report, up $1.90 with a weighted average of $111.58 on 6,326 head. July corn is down 23 3/4 cents per bushel and July soybean meal is down $17.50. The Dow Jones Industrial Average is down 222.84 points.
LIVE CATTLE:
The live cattle market fell in line with the rest of the commodities and rounded out Tuesday's trade fully lower. June live cattle closed $1.65 lower at $130.52, August live cattle closed $2.02 lower at $130.37 and October live cattle closed $1.90 lower at $136.15. As the market plummeted to new lows for the for the year, cattlemen are still stuck juggling the short- and long-term balls of the market. In the near term, cattlemen are trying to forecast how tough the summer could become, all while trying to gauge how strong the market could be in the latter half of the year. Watching both beef prices and slaughter speeds through June will be incredibly important. The cash cattle market saw a little business develop in the South at $135, but not enough to say that any sort of trend was established, but the market does expect to see some business develop by Wednesday. New showlists also appear to be mixed, lower in Kansas, Nebraska/Colorado and somewhat higher in Texas.
Tuesday's slaughter is estimated at 126,000 head, 1,000 head more than a week ago and 31,000 head more than a year ago. Monday's slaughter is estimated at 3,000 head.
Boxed beef prices closed higher: choice up $2.12 ($267.54) and select up $2.15 ($248.65) with a movement of 144 loads (95.17 loads of choice, 32.57 loads of select, 9.18 loads of trim and 7.46 loads of ground beef).
WEDNESDAY'S CASH CATTLE CALL: Steady to $1.00 lower. Showlists are manageable in the North and even though seasonally the market sits in packers' favor, feedlots may be able to see losses of only $1.00 or so as opposed to losing $3.00 to $4.00 in a week as showlists are current still and carcass weights are declining.
FEEDER CATTLE:
With the rest of the marketplace seeming to have lost its footing and submitting to the descend, the feeder cattle complex wasn't strong enough to stand alone and close higher while the rest of the markets around it tumbled lower. Even with the corn complex seeing a $0.18 to $0.23 reduction in its nearby contracts, the market closed lower. August feeders closed $1.20 lower at $165.12, September feeders closed $1.17 lower at $168.12 and October feeders closed $1.12 lower at $170.70. Sale receipts were light throughout Tuesday's market, as some sale barns are closed for the holiday-shortened week and others saw limited receipts. The market will likely see better interest in its sales that are scheduled for the later half of the week as by that point everyone will be back to the market and operating as normal. The CME Feeder Cattle Index for May 30: down $0.13, $153.22.
LEAN HOGS:
The lean hog market's pressure stemmed from its inability to muster any significant support. As most of the commodity markets saw steep selloffs, the lean hog complex seemed to jump in line for the same demise, even though pork cutout values closed higher and the cash market saw substantial interest too. Nevertheless, the market's demise was largely influenced by the rest of the market's rapid-fire selling behavior, and Wednesday will have to determine if it's going to rest on its own internal influences or flutter based on what the other markets do or don't do. June lean hogs closed $2.42 lower at $107.97, July lean hogs closed $3.72 lower at $108.00 and August lean hogs closed $4.02 lower at $106.42. Pork cutouts total 342.21 loads with 306.76 loads of pork cuts and 35.45 loads of trim. Pork cutout values: up $1.55, $107.71. Tuesday's slaughter is estimated at 480,000 head, 7,000 head more than a week ago and 82,000 head more than a year ago. Monday's slaughter is estimated at 2,000 head. The CME Lean Hog Index for May 26: up $0.53, $104.93.
WEDNESDAY'S CASH HOG CALL: Higher. Given that, in the later half of last week's trade, packers sat idly, it's likely that they have to restock and be active early in this week's market.
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