GENERAL COMMENTS:
The cattle complex ran out of support Wednesday as traders looked for a strong fundamental reason why they should continue to advance the contracts. Upon seeing none, both the live cattle and feeder cattle contracts closed slightly lower. Meanwhile, the lean hog market closed slightly higher and hog fans hope Thursday's export report is again fruitful. Hog prices closed higher on the Daily Direct Afternoon Hog Report, up $0.09 with a weighted average price of $89.13 on 8,416 head. May corn is down 3/4 cent per bushel and May soybean meal is up $3.40. The Dow Jones Industrial Average is down 45.66 points.
LIVE CATTLE:
The live cattle complex closed mixed with the market's nearby contracts rounding out the day lower and deferred contracts closed higher. If traders had been thrown a bone throughout the day -- may be in the form of better cash cattle trade or stronger boxed beef prices -- the market may have stood a chance at closing higher. Without better fundamental support, lower closes dominated the nearby contracts.
June live cattle closed $0.40 lower at $175.32, August live cattle closed $0.15 lower at $172.77 and October live cattle closed $0.07 lower at $175.72. No cash cattle trade developed throughout the day. Asking prices are set at $184 to $185 in the South and not yet established in the North. Packer interest should improve on Thursday. Wednesday's slaughter is estimated at 124,000 head -- 12,000 head more than a week ago and 1,000 head less than a year ago.
Boxed beef prices closed lower: choice down $1.24 ($296.78) and select down $1.76 ($290.88) with a movement of 123 loads (73.64 loads of choice, 28.91 loads of select, zero loads of trim and 20.17 loads of ground beef).
THURSDAY'S CATTLE CALL: Somewhat lower. Given that packers have been able to back up supplies, it's likely this week's trade will again be $2 to $4 lower.
FEEDER CATTLE:
As much as it would have liked to round out the day higher, the feeder cattle complex closed lower without enough support from the live cattle market. If the nearby live cattle contracts had closed higher, the market could have potentially traded somewhat higher as demand continues to be sufficient in the countryside. With parts of the West and Central Plains getting moisture, cattlemen are thankful for the precipitation. Even so, today's market closed slightly below steady levels as traders weren't confident in advancing the market again today.
May feeders closed $0.70 lower at $240.27, August feeders closed $0.22 lower at $252.12 and September feeders closed $0.22 lower at $253.37. At Winter Livestock Auction in La Junta, Colorado, compared to last week, feeder steers under 700 pounds sold $2 to $8 lower with instances of sharply lower. Steers over 700 pounds sold for $2 to $10 higher. Feeder heifers sold mostly $2 to $9 higher across all weight classes. Slaughter cows traded steady and slaughter bulls sold steady to $1 higher. Feeder cattle supply over 600 pounds was 58%. The CME feeder cattle index April 16: up $1.27, $242.63.
LEAN HOGS:
Of all the livestock contracts, the lean hog complex closed with the most support as traders mildly advanced the market ahead of closing. Pork cutout values did not close higher, but at least they didn't close lower and the belly didn't end the day with double-digit losses. Traders and hog producers alike are hoping Thursday's export report shows strong international demand which could give the market another leg up.
June lean hogs closed $0.10 lower at $102.72, July lean hogs closed $0.27 higher at $104.30 and August lean hogs closed $0.47 higher at $102.07. Pork cutouts totaled 236.50 loads with 216.28 loads of pork cuts and 20.22 loads of trim. Pork cutout values: steady, $99.55. Wednesday's slaughter is estimated at 486,000 head -- 3,000 head less than a week ago and 9,000 head more than a year ago. The CME lean hog index April 15: up $0.25, $90.98.
THURSDAY'S HOG CALL: Lower. Given that packers bought over 8,000 head, it's likely the bulk of their needs are fulfilled for the week.
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