GENERAL COMMENTS:
USDA's announcement that their now testing ground beef for traces of avian influenza did not sit well with the cattle complex and ultimately led traders to dump both the live cattle and feeder cattle contracts lower by Tuesday's end. Hog prices closed higher on the Daily Direct Afternoon Hog Report, up $2.40 with a weighted average price of $92.03 on 6,186 head. July corn is down 2 1/2 cents per bushel and July soybean meal is down $2.40. The Dow Jones Industrial Average is down 570.17 points.
LIVE CATTLE:
As a precautionary measure, the USDA is now in the beginning stages of testing ground beef for the H5N1 virus -- which is what panicked the cattle complex and sent both the live cattle and feeder cattle markets tumbling lower throughout Tuesday's trade. Although the USDA has publicly stated that they believe the meat supply is safe, the announcement still rattled traders and consequently led to the market's sharply lower close. Chris Clayton, DTN's Ag Policy Editor wrote on the matter which can be accessed here:
June live cattle closed $2.17 lower at $174.97, August live cattle closed $2.57 lower at $173.10 and October live cattle closed $2.72 lower at $177.05. There were a few cattle traded in the North as today's sharply lower pressured some feedlots into marketing their cattle early, but all in all the cash cattle market still hasn't seen any substantial trade develop and won't likely until after Wednesday sometime. Asking prices are noted in the South at $186 but have yet to be established in the North. Lousy boxed beef interest continues to be problematic for the market especially given that right now has historically been the market's prime time in selling beef ahead of early summer cookouts.
Tuesday's slaughter is estimated at 124,000 head -- 1,000 head less than a week ago and 3,000 head less than a year ago.
Boxed beef prices closed lower: choice down $3.16 ($294.37) and select down $0.26 ($289.95) with a movement of 110 loads (69.13 loads of choice, 21.71 loads of select, zero loads of trim and 19.01 loads of ground beef).
WEDNESDAY'S CATTLE CALL: Lower. Given the sharp selloff in today's futures complex, packers will likely be able to get cattle bought for cheaper money this week.
FEEDER CATTLE:
The bird flu once again dominated the cattle complex and was the Achilles heel of the market's demise through Tuesday's trade. May feeder cattle closed $3.45 lower at $244.57, August feeders closed $4.12 lower at $255.50 and September feeders closed $4.25 lower at $256.47. Demand was still strong and stable in the countryside, but from a technical standpoint, the complex stood little chance of closing higher as fear again consumed traders' minds. At Joplin Regional Stockyards in Carthage, Missouri compared to last week feeder steers sold $2.00 to $5.00 higher with five weight steers selling for as much as $13.00 higher. Feeder heifers sold from $2.00 lower to $4.00 higher. Feeder cattle supply over 600 pounds was 65%. The CME feeder cattle index 4/29/2024: down $0.18, $247.00.
LEAN HOGS:
The lean hog complex didn't close as bleakly as the cattle contracts did, but its support wasn't all that great either as the market's nearby contracts continue to struggle as summertime demand remains in question. However, the market's deferred contracts were able to close slightly higher. Even though the summer 2024 contracts have been under pressure as of late, it is still encouraging to see that the June 2024 through August 2024 contracts are all still trading above $100.00. Today's pork cutout values closed mixed with the biggest gains being seen in the rib (up $3.81) but the $1.26 loss in the belly and $1.08 loss in the ham sucked the overall carcass price into closing lower. June lean hogs closed steady at $102.47, July lean hogs closed $0.02 lower at $105.42 and August lean hogs closed $0.27 lower at $103.40. Pork cutouts totaled 248.12 loads with 228.32 loads of pork cuts and 19.80 loads of trim. Pork cutout values: down $0.24, $98.76. Tuesday's slaughter is estimated at 482,000 head -- 4,000 head less than a week ago but 10,000 head more than a year ago. The CME lean hog index 4/26/2024: down $0.52, $90.36.
WEDNESDAY'S HOG CALL: Steady/somewhat lower. Packers bought over 6,000 head in today's cash market which could mean that the bulk of their weekly buying is done.
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