GENERAL COMMENTS:
Livestock futures are showing a sign of market stability trying to reestablish through the complex Wednesday morning, although live cattle and feeder cattle futures remain lower at midday. The continued weakness through the cattle trade is likely to spill into cash markets, although at this point, little indication is seen that beef values will be significantly impacted in the immediate future. Mixed price movement in lean hog trade is helping to bring some additional buyer interest back to the table. July corn is down 6 cents at $4.103 and July soybean meal is down $3.70 at $276.8. The Dow Jones Industrial Average is down 93.46 points at 42,995.56.
LIVE CATTLE:
Live cattle futures have continued to hold early losses Wednesday morning, although the aggressive selling tone seen early in the week seems to have eased slightly. October and December contracts are holding $1 per cwt losses, but the underlying lack of follow through pressure as the morning continues could help to draw buyers back into the complex during afternoon trade. There continues to be an aggressive price spread of $15 per cwt between spot June and October contracts, with front month futures heavily impacted by current wholesale beef values and the current demand to gain access to immediate supplies. Cash cattle markets remain quiet once again Wednesday morning. It's another slow start in cash cattle country with only some early asking prices noted around $228 to $230 in the South, but they are still not established in the North. Bids remain hard to find, and significant trade volume will probably be delayed until Thursday and/or Friday. June live cattle are unchanged, August live cattle are $0.45 lower at $209.1, October live cattle are $0.68 lower at $206.275.
Boxed beef prices are mixed: choice up $0.76 ($395.01) and select down $3.77 ($378.64) with a movement of 62.25 loads (36.82 loads of choice, 11.39 loads of select, 5.83 loads of trim and 8.21 loads of ground beef).
FEEDER CATTLE:
Feeder cattle futures remain lightly traded midweek with single-digit price shifts seen in nearby contracts at midday. The lack of aggressive selling in live cattle futures and expected continued support in cash feeder cattle trade is likely to help keep prices above the $300 per cwt level for the immediate future.
In the USDA National Feeder Cattle Summary released Tuesday, compared to the previous week, very uneven price trends this week on calves and yearlings with many sales in the Central and Northern Plains on a bi-monthly summer schedule. Calves sold mostly 5.00 lower to 5.00 higher with big yearling feeders mostly over 800 lbs. selling in a wide price range as well from steady to as much as 10.00 higher to as much as 10.00 lower. Monday's sale in Sioux Falls, South Dakota BBQ Special sold 540 hd of 850-900 lb. steers averaging 878 lbs. for a weighted average price of 303.16. Tuesday in Lexington, Kentucky, at Blue Grass Stockyards sold 110 hd of 908 lb. steers at 309.80, 62 steers weighing 830 lbs. at 324.95. Tuesday in Beaver, Oklahoma, at Beaver County Livestock sold 283 hd of 918 lb. steers for a weighted average price of 305.01. Wednesday in Aberdeen, South Dakota, at the Hub City Livestock Auction sold 949 hd of 1,012 lb. steers for a weighted average price of 293.07. In Bloomfield, Iowa, on Wednesday at Bloomfield Livestock sold 61 steers weighing 819 lbs. at 328.00. Friday in Ft. Pierre, South Dakota, at Ft. Pierre Livestock Auction sold 861 hd of 900-950 lb. steers averaging 933 lbs. for a weighted average price of 311.55 and 504 hd of 800-850 lb. steers averaging 811 lbs. for a weighted average price of 324.09 and that was on a down market. Also, want to mention Northern Video's (Billings, Montana) early summer special this week with near 68,000 head on offer with a list of impressive sales way too numerous to mention. Some big yearlings, 570 hd averaging 1,090 lbs. value added for current delivery sold for a weighted average price of 285.50 and 1200 hd of 990 lb. steers for August delivery sold for a weighted average price of 301.50. So, demand remains very good for calves and yearlings to go on feed.
August feeders are $0.28 higher at $302.525, September feeders are $0.33 higher at $302.775 and October feeders are $0.28 lower at $300.375.
LEAN HOGS:
Lean hog futures remain mixed in very limited trade Wednesday morning. Narrow to moderate gains are slowly developing at midday in July and August contracts as traders continue to focus on current supply levels. The Quarterly Hogs and Pigs Report will be released Thursday and will give a better understanding of current inventories through the summer and early fall months. This report seldom significantly impacts short-term price movements but is used as a gauge of the long-term direction of market supply, and this is expected to also be the case Thursday.
July lean hogs are $0.20 higher at $112.425, August lean hogs are $0.18 higher at $111.125 and October lean hogs are $0.08 lower at $95.40. Hog prices are unreported at this point due to confidentiality on the Daily Direct Morning Hog report. Pork cutouts totaled 140.58 loads with 121.70 loads of pork cuts and 18.88 loads of trim. Pork cutout values are down $0.53 at $121.22.
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