GENERAL COMMENTS:
Both the live cattle and feeder cattle contracts are rallying into Monday's noon hour as the market continues to feed off its extremely strong fundamental outlook. Corn prices are weaker again Monday morning, which is also helping drive cattle prices higher. The lean hog complex is trading lower as traders are skeptical about long-term demand. May corn is down 2 1/2 cents per bushel and May soybean meal is up $12.40. The Dow Jones Industrial Average is up 159.26 points.
LIVE CATTLE:
The live cattle market is making bold moves Monday morning as the spot April contract is trading in new territory and, if the market closes at these current levels, the contract will yet another carve out another new contract high. April live cattle are up $0.87 at $166.30, June live cattle are up $0.47 at $161.15 and August live cattle are up $0.55 at $160.45. With the momentum of last week's market still on the forefront of everyone's mind, feedlot managers and traders as eager to see what the week accomplishes. Cash cattle prices will likely be higher again this week as packers need enough cattle to fulfill demand and don't want to be short when beef prices are this high. New showlists appear to be mixed, his week, higher in Texas and Nebraska/Colorado.
Boxed beef prices are higher: choice up $1.21 ($290.53) and select up $0.89 ($277.75) with a movement of 34 loads (26.34 loads of choice, 5.06 loads of select, zero loads of trim and 2.71 loads of ground beef).
FEEDER CATTLE:
The feeder cattle complex hasn't wasted any time in Monday's market as the nearby contracts are trading well over $2.00 higher and rallying on the strong market combination of excellent beef demand amid tight supplies and weakening grain prices. March feeders are up $2.27 at $192.27, April feeders are up $2.75 at $198.77 and May feeders are up $2.37 at $203.32. So long as the live cattle and cash cattle prices continue to work their way higher, the feeder cattle complex should have no issue continuing to trade steady to higher as the market is seeing all the support it needs.
LEAN HOGS:
The lean hog complex isn't as ambitious as the cattle contracts are, as its contracts are trading mostly lower into Monday's afternoon. I'm hoping that the market will find clarity in Wednesday's WASDE report and potentially even see mildly strong pork demand in the second quarter. Pork demand has been hit and miss over the last couple of weeks and, for traders to feel confident in the market, they need to see steady demand. April lean hogs are down $0.67 at $83.87, June lean hogs are down $0.17 at $100.45 and July lean hogs are down $0.02 at $102.82.
The projected lean hog index for March 3 is up $0.20 at $78.91, and the actual index for March 2 is up $0.06 at $78.71. Hog prices are higher on the Daily Direct Morning Hog Report, up $0.02 with a weighted average of $77.87, ranging from $70.00 to $79.00 on 3,293 head and a five-day rolling average of $78.06. Pork cutouts total 142.77 loads with 125.55 loads of pork cuts and 17.23 loads of trim. Pork cutout values: up $1.85, $87.42.
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