GENERAL COMMENTS:
In most cases, the livestock futures contacts didn't accelerate momentum this week or definitively change direction, but instead continued to explore what strength is possible in the wholesale meat markets and how that strength can persist further down the supply chain. Live cattle led the futures gains Friday, and by the end of the session, prices were green all across the livestock board. As of early Friday afternoon, some light cash cattle trade is developing in Nebraska at $295, $1.50 higher than last week's weighted average basis Nebraska. The National Direct Afternoon Hog Report showed negotiated swine prices down $0.88 to a weighted average of $99.67 on 2,262 head. Prices ranged from $93 to $106, and the five-day rolling average is now $102.44. September corn moved up 3 1/2 cents to $4.84 1/4 per bushel and August soybean meal closed down $7.10 per ton to $444.10. The Dow Jones Industrial Average was down 148.69 points and the NASDAQ was down 78.62 points.
From Friday to Friday, livestock futures scored the following changes: August live cattle up $2.75, October live cattle up $3.30, August feeder cattle up $3.93, September feeder cattle up $4.48, August lean hogs off $2.18, October lean hogs off $1.95, September corn off $0.37, December corn off $0.33.
LIVE CATTLE:
The live cattle market this week was always shaping up to be a Friday showdown, and this was even true for futures traders, who got buffeted by outside market volatility for a few days, but ultimately reaffirmed their bullishness Friday. The August contract closed up $2.40 at $180.90; the October contract closed up $1.60 at $182.90, and the December contract closed up $1.50 at $187.05. These aren't fresh contract highs, but if beef packer profitability can survive at the present balance, there is always a chance that the overall market could squeeze blood from a stone in some coming week. As of early Friday afternoon, some light cash cattle trade is developing in Nebraska at $295, $1.50 higher than last week's weighted average basis Nebraska.
Boxed beef prices were lower: choice down $0.22 ($301.79) and select down $1.83 ($276.48), with a movement of 121 loads (65.66 loads of choice, 19.38 loads of select, 27.05 loads of trim and 9.04 loads of ground beef).
MONDAY'S CASH CATTLE CALL: Monday's activity will likely be limited to the collection of showlists, but the fundamentals of the market should support steady prices.
FEEDER CATTLE:
Deferred feeder cattle contracts for the crop of calves that will come to the market this fall hit some fresh contract highs Friday: $256.075 for the October contract and $256.75 for the November contract. At the end of the session, the August feeder cattle contract was up $1.575 at $249.525, the September contract was up $1.80 at $253.45, and the October contract was up $2.00 at $255.425. It was a relatively busy week for the feeder cattle futures market, in terms of trading volume, with speculators reacting to outside market movements. Out in cow-calf country, however, it remains droughty and unlikely to support any quick resupply of a small beef cattle herd. The CME Feeder Cattle Index for Aug. 1 is $244.88.
LEAN HOGS:
Amid a dome of extreme heat over the southern United States and challenging shipping conditions, pork packers haven't been able to push for large volumes this week, and the hog market had to reflect that. However, Friday's futures trade was able to close with some small upward corrections. The August lean hog contract closed up $0.025 at $101.025; the October contract closed up $1.025 at $83.075; and the December contract closed up $0.75 at $75.30. Pork cutout values have been resilient this week after a two-month run-up, but lean hog futures traders nevertheless were net sellers this week of previously profitable trend-following positions. The afternoon pork cutout showed the overall carcass value down $1.94 to $113.69, with bellies giving back some of their previous volatile gains. There were 225.80 total loads (198.81 loads of cuts and 26.99 loads of trim). The CME Lean Hog Index for 8/2: up $0.06, $105.86, and the projected Index for Aug. 3: down $0.39, $105.47.
MONDAY'S CASH HOG CALL: Steady. Better weather won't necessarily lead to a push in slaughter numbers while the market is feeling toppy.
No comments:
Post a Comment