GENERAL COMMENTS:
The livestock complex is trading quite well considering that corn prices are also trading higher. Still no cash cattle trade has developed as feedlots and packers remain in a stiff standoff, waiting for the other to cave. December corn is up 4 1/2 cents per bushel and December soybean meal is down $0.40. The Dow Jones Industrial Average is up 105.07 points.
LIVE CATTLE:
There's not much more thrilling than seeing feedlots so committed to marketing their showlists to the best of their abilities that they're willing to wait until the last minute on Friday to trade, or even ready to roll their showlists over into the next week, if need be. Feedlots understand that packers have captive supply of cattle committed to them in July, but they also know that doesn't mean they'll be able to completely walk away from the cash market and not be short bought. It's a war out in the cash cattle market right now as feedlots want at least steady money for their cattle, and packers begrudgingly don't want to pay those prices. A single bid of $175 is currently being offered in Texas, but otherwise the market is still extremely quiet. Asking prices in the South are noted at $180 to $182, and in the North at $295-plus. The tenacious spirit of feedlots is helping drive stronger trade throughout the futures complex as traders are pushing all the live cattle contracts at least $1.00 higher. August live cattle are up $1.87 at $178.77, October live cattle are up $1.82 at $181.92 and December live cattle are up $1.77 at $185.17.
Boxed beef prices are lower: choice down $0.77 ($306.14) and select down $2.38 ($277.80) with a movement of 102 loads (44.87 loads of choice, 21.45 loads of select, 20.74 loads of trim and 15.06 loads of ground beef).
FEEDER CATTLE:
Even though the nearby corn contracts are rallying anywhere from $0.04 to $0.14 higher, the feeder cattle complex sees more validity Friday morning in the fact that cash cattle trade has still not developed. Feeders see the strength in the cash market as a sure sign that market ready supplies of fat cattle are thin and that feedlots are demanding more power and leverage instead of being at the mercy of packers like they were just a few years back when supplies of cattle were burdensome. If feedlots continue to make money and see more opportunity in the fat cattle market, then feeder cattle demand should remain strong, especially if this year's corn crop is as big as it's projected to be. August feeders are up $1.62 at $246.62, September feeders are up $1.87 at $249.20 and October feeders are up $1.92 at $250.50.
LEAN HOGS:
The lean hog complex is seeing some pressure in its spot and nearby contracts, but otherwise the market is pushing a mild rally into Friday's noon hour. The cash hog market isn't lending any support as prices did a nosedive lower as packers more or less told the market that they didn't need any more hogs this week, but luckily pork cutout values are still trending higher. If pork cutout values can hold strong through closing than the market stands a chance at keeping its deferred contracts green through closing. August lean hogs are down $0.10 at $96.35, October lean hogs are down $0.05 at $83.30 and December lean hogs are up $0.02 at $76.07.
The projected lean hog index for July 13 is up $0.74 at $101.03, and the actual index for July 12 is up $0.93 at $100.29. Hog prices are lower on the Daily Direct Morning Hog Report, down $9.10 with a weighted average price of $92.65, ranging from $91.00 to $99.00 on 619 head with a five-day rolling average of $100.02. Pork cutouts total 153.76 loads with 141.03 loads of pork cuts and 12.73 loads of trim. Pork cutout values: up $4.84, $115.74.
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