GENERAL COMMENTS:
Livestock futures have regained momentum Friday morning, with active gains seen in all cattle markets. Nearby live cattle futures are holding gains of $2 to $2.77 per cwt, while feeder cattle buying is leading the charge higher with gains of $3 per cwt in nearby trade months. The early week pressure has left markets generally unsettled and unable to find additional commercial or noncommercial buyer support. But the ability to move prices off of midweek lows has sparked renewed trade optimism. Hog futures are mixed in generally sluggish trade activity following Thursday's quarterly hogs and pigs report. Production numbers and breeding stock totals were nearly unchanged from a year ago, but the fact that overall hog numbers did not decrease is causing limited softness in a few nearby lean hog contracts Friday morning. July corn is up 5 3/4 at $4.153 and July soybean meal is up $0.70 at $271.6. The Dow Jones Industrial Average is up 544.25 at 43,931.09.
LIVE CATTLE:
Live cattle futures have followed the feeder cattle market higher, posting the first active gain in the complex in over a week. August futures are leading the shift higher, as traders continue to focus on moderate to strong support still holding in wholesale beef prices. Triple-digit gains are seen through the entire complex as traders have found renewed support at $209 per cwt in August futures contracts. This underlying support through the entire market at the end of the week could help to solidify follow-through buying early next week. Although volume next week is still questionable, with the end of the month, and quarter seen early in the week, and markets closed at the end of the week due to the Independence Day holiday break.
Cash cattle trade still remains generally sluggish, with light trade being reported in parts of the North at $368, dressed, steady with yesterday's business but $9 lower than last week's weighted average basis Nebraska. The South remains rather quiet following yesterday's live sales at $224 to $225, $4 to $5 lower than the prior week's weighted averages. Some asking prices remain firm around $225-plus in the South and $370-plus in the North. Following up on yesterday's news, Teamsters Local 577 members at Tyson Foods in Amarillo, Texas, reported this morning that they have decided to strike. This facility has a daily slaughter capacity of around 5,500 head. June live cattle are $3.00 higher at $224.7, August live cattle are $2.98 higher at $212.175 and October live cattle are $2.65 higher at $209.00.
Boxed beef prices are Higher: choice up $1.14 ($396.19) and select up $2.52 ($382.26) with a movement of 60.61 loads (34.21 loads of choice, 8.39 loads of select, 10.64 loads of trim and 7.37 loads of ground beef).
FEEDER CATTLE:
Feeder cattle have rallied higher Friday morning, with active triple-digit gains seen in all nearby contracts. August futures are leading the complex higher, with prices moving well above $305 per cwt during morning trade. The ability to string together three positive market gains earlier this week following strong pressure the previous week has helped to create stability through the feeder cattle market and allowed traders to use previous price levels as support levels. If morning gains continue to hold through the end of the trading session, this will account to a weekly gain of $4.25 per cwt in front-month futures. Although this is still well below recent highs, the feeder cattle complex could potentially spend the next few weeks hovering within the current market range. Strong beef demand continues to be seen through the summer months, with active buyer support in feeder cattle buying likely to continue in the near future. August feeders are $3.35 higher at $306.65, September feeders are $3.25 higher at $306.625 and October feeders are $3.05 higher at $304.475.
LEAN HOGS:
Lean hog futures are mixed in lackluster trade Friday morning. Summer contracts are posting light to moderate gains Friday morning on strong financial market moves and indications that positive gains are seen in trade talks with China. October through April contracts are holding light losses as follow-through pressure after the hogs and pigs report Thursday is limiting buyer interest. Traders continue to be slightly disappointed that overall hog numbers have not eased. However, many of the adjustments seen Friday seem to be focused on backing away from pre-report positions rather than any major shift in market direction following the report. Nearby gains are supported based on strong continued demand, while long-term supply levels may continue to limit price support through the winter months. July lean hogs are $0.65 higher at $112.975, August lean hogs are $0.08 higher at $110.325 and October lean hog prices are lower on the Daily Direct Morning Hog report, down $0.24 with a weighted average of $107.85, ranging from $106.00 to $110.00 on 498 head with a five-day rolling average of $110.77. Pork Cutouts totaled 190.88 loads, with 174.24 loads of pork cuts and 16.64 loads of trim. Pork cutout values are up $4.65 at $123.76. n hogs are $0.50 lower at $94.375.
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