GENERAL COMMENTS:
The livestock complex was thrown a wild card in Wednesday's market as the cattle contracts reacted poorly to the Consumer Price Index report, but the lean hog market ran higher as the spot February contract expired. Hog prices closed higher on the Daily Direct Afternoon Hog Report, up $0.02 with a weighted average price of $68.21, ranging from $64.00 to $70.00 on 5,131 head. March corn is down 6 1/2 cents per bushel and March soybean meal is down $1.50. The Dow Jones Industrial Average is up 151.52 points.
LIVE CATTLE:
The live cattle complex wasn't able to shake the pressures that rose up thanks to the Consumer Price Index, but thankfully the market didn't close as low as it had traded earlier in the day. The significant pressures the futures market received put some stress on the cash cattle market and a few sales were noted in the South at $180 which is $2.00 lower than last week's weighted average. The week's total volume of sales is still incredibly thin so prices could still show a different trend, but the cash market has been lightly tested. More trade will need to develop ahead of the week's end, and asking prices for cattle left to sell in the South are noted at $183 plus and asking prices in the North are noted at $289 plus. February live cattle closed $1.35 lower at $182.40, April live cattle closed $1.10 lower at $184.00 and June live cattle closed $1.42 lower at $181.12.
Wednesday's slaughter is estimated at 123,000 head -- 3,000 head less than a week ago and steady with a year ago.
Boxed beef prices closed lower: choice down $1.81 ($292.27) and select down $1.72 ($285.30) with a movement of 108 loads (65.57 loads of choice, 23.50 loads of select, 5.24 loads of trim and 13.94 loads of ground beef).
THURSDAY'S CATTLE CALL: Steady at best. Given that some weaker trade has already developed in the South, it's likely that the week's best-case scenario is that prices remain steady with last week's weighted average.
FEEDER CATTLE:
Even though the feeder cattle complex still closed lower, thankfully its ending point wasn't as low as what the market was trading earlier in the day. The market's pressure stemmed from the fact that the Consumer Price Index reached 3.1%, which is the highest the index has been since last November. Besides the obvious inflation pressures that the index represents, the other downside to an increase in the index is that this likely means that the Feds won't decrease interest rates any time soon -- and in this type of market, interest rates simply cannot be ignored. March feeders closed $1.77 lower at $246.22, April feeders closed $2.15 lower at $249.60 and May feeders closed $2.50 lower at $252.95. At the Winter Livestock Auction in La Junta, Colorado compared to last week feeder steers under 600 pounds traded $6.00 to $11.00 higher with instances even higher than that. Steers over 600 pounds sold $9.00 to $10.00 higher. Feeder heifers under 450 pounds sold $7.00 lower while heifers over 450 pounds sold $2.00 to $5.00 higher. Feeder cattle supply over 600 pounds was 38%. The CME feeder cattle index 2/13/2024: not available at this time.
LEAN HOGS:
It was a fast and furious day for the lean hog complex as the market saw tremendous support throughout the futures complex and saw mixed interest from its fundamentals. April lean hogs closed $3.45 higher at $84.52, June lean hogs closed $2.07 higher at $96.77 and July lean hogs closed $1.65 higher at $97.82. Pork cutout values didn't lend much support throughout the day as the overall carcass price closed lower and was mostly brought down by the $5.41 decline in the ham. Today's volume of cash hog sales was slightly better as over 5,000 head traded -- which is substantial compared to the volumes that have been trading lately. Pork cutouts totaled 287.62 loads with 231.60 loads of pork cuts and 56.02 loads of trim. Pork cutout values: down $1.26, $85.90. Wednesday's slaughter is estimated at 489,000 head -- 2,000 head more than a week ago and 5,000 head more than a year ago. The CME lean hog index 2/12/2024: up $0.41, $74.11.
THURSDAY'S HOG CALL: Lower. Given that packers bought more hogs today than they have been, it's likely that they filled up the majority of their needs for the week.
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