Wednesday Morning Livestock Market Update - Traders Focus On Current Demand Rather Than Tariffs

GENERAL COMMENTS:

Cattle futures experienced strong gains on Tuesday with contracts reaching back near their highs. Traders seemed more focused on cattle supplies and good demand rather than tariffs. It will take some time to see the impact on international demand. Domestic demand remains strong as boxed beef prices continue to increase. Prices jumped $6.96 for choice and $2.06 for select. Strong consumer demand may keep feedlots holding for higher cash as initial offers are $2.00 higher than last week. However, it is uncertain how aggressive packers need to be, as they had purchased some cattle ahead. Feedlots have been holding cattle the past few weeks as cash has been strong, but now they may be more aggressive in moving those cattle rather than holding out another week. Feeder cattle led the charge on Tuesday as demand for feeder cattle in the country remains strong.

Hog futures found buying interest Tuesday after the decline on Monday with all contracts posting triple-digit gains. Traders were aggressive buyers, anticipating the possibility of limited impact from tariffs. Demand might improve as consumers may reduce beef consumption due to high prices, and include more pork in their diets. Support did not come from cash or cutouts as they continued to struggle. The National Daily Direct Afternoon Hog report showed cash down $0.23. Pork cutouts fell $1.94. The variability of cutouts may not be due to demand, but rather the plentiful supply of pork, as slaughter remains strong with higher hog weights. The strong slaughter pace may be a better indicator of demand rather than just focusing on cutout prices.

	BULL SIDE		BEAR SIDE
1)	The strong rebound in cattle futures may signal that the price retracement has been completed and the uptrend may continue.	1)	Packers may not bid aggressively for cattle this week, as it seems they have already purchased cattle ahead.
2)	Boxed beef prices continue to move to new highs as consumers prefer beef in their diets despite the higher prices.	2)	Feedlots may be willing to sell cattle at steady cash and move those cattle they have been holding that are at higher weights. They may not want to take a chance on cash prices next week.
3)	Hog futures moved back into the trading range as traders remain interested in buying on price weakness.	3)	Hog futures did not find support from cash or cutouts, which may limit the upside price potential.
4)	Hog futures still have chart gaps that may be filled at some point. Gaps generally are filled during the life of the contract.	4)	Traders remain uncertain over the impact tariffs might have on international demand for pork. Reduced international demand would increase domestic supplies.

Tuesday Closing Livestock Market Update - Traders Push Contracts Higher

GENERAL COMMENTS:

The livestock complex was well supported by traders as all three of the markets closed higher Tuesday afternoon. Still no cash cattle trade has developed, and trade will likely be delayed until Thursday or Friday. May corn is up 4 1/2 cents per bushel and May soybean meal is down $0.40. The Dow Jones Industrial Average is down 11.80 points.

LIVE CATTLE:

It was a positive day for the live cattle complex as the market successfully rounded out the day fully higher. Aside from seeing boxed beef prices jolt higher, the market was mostly encouraged to trade higher by traders' simple willingness to again support the complex. After reaching a new contract high again just last week in the spot June contract, traders were leery late last week/early this week of being too supportive, but thankfully strong beef demand has helped turn the futures complex higher again. April live cattle closed $1.32 higher at $209.12, June live cattle closed $1.77 higher at $205.42 and August live cattle closed $2.30 higher at $202.32. No cash cattle trade developed throughout the day but asking prices are noted at $212 in the Southern plains. 

Tuesday's slaughter is estimated at 123,000 head -- 1,000 head less than a week ago and 2,000 head more than a year ago.

Boxed beef prices closed higher: choice up $6.96 ($342.22) and select up $2.06 ($322.07) with a movement of 95 loads (59.73 loads of choice, 18.70 loads of select, 7.31 loads of trim and 9.46 loads of ground beef).

WEDNESDAY'S CATTLE CALL: Steady. Given that packers have successfully been able to buy up some inventory in the last two weeks, it's most likely that fed cash cattle prices will trade steady/somewhat lower later this week.

FEEDER CATTLE:

The feeder cattle complex only grew stronger and stronger as Tuesday traded onward as the market saw most of its contracts close anywhere from $2.00 to $3.00 higher. April feeders closed $1.82 higher at 288.27, May feeders closed $2.65 higher at $287.15 and August feeders closed $2.90 higher at $292.40. It was especially interesting to note the change in the contract's relationship between the live cattle and feeder cattle contracts. Lately, the feeder cattle complex has simply doggishly followed the live cattle market's direction, but today the feeder cattle contracts were the leader of the bullish move. At Oklahoma National Stockyards in Oklahoma City, Oklahoma, compared to last week feeder steers and steer calves traded steady to $5.00 lower. Feeder heifers and heifer calves sold steady to $5.00 higher, except those weighing 500 to 700 pounds, which traded $1.00 to $5.00 lower. Feeder cattle supply over 600 pounds was 69%. The CME feeder cattle index 3/31/2025: down $0.48, $291.02.

LEAN HOGS:

The lean hog complex was also able to capitalize on the positive push from traders as its contracts closed higher. April lean hogs closed $0.35 lower at $87.37, June lean hogs closed $1.75 higher at $97.02 and July lean hogs closed $1.75 higher at $97.57. Today's move stems solely from the market's technical support as both the cash market and pork cutout values closed lower, which is not helping lend any support to the lean hog contracts. Hog prices closed lower on the Daily Direct Afternoon Hog Report, down $0.23 with a weighted average price of $88.26 on 8,610 head. Pork cutouts totaled 353.31 loads, with 314.58 loads of pork cuts and 38.73 loads of trim. Pork cutout values: down $1.94, $95.51. Tuesday's slaughter is estimated at 489,000 head -- 1,000 head less than a week ago and 2,000 head more than a year ago. The CME lean hog index 3/28/2025: down $0.28, $88.50.

WEDNESDAY'S HOG CALL: Steady/somewhat higher. Packers will need more hogs this week. While it's difficult to predict the market's price direction, I beli

Tuesday Midday Livestock Market Update - Traders Turn the Contracts Higher

GENERAL COMMENTS:

The livestock contracts are all trading higher into Tuesday's noon hour as traders have changed their demeanor toward the livestock complex. Still no cash cattle trade has developed, and the week's trade will likely be again delayed until Friday. May corn is up 4 3/4 cents per bushel and May soybean meal is down $0.30. The Dow Jones Industrial Average is up 130.17 points.

LIVE CATTLE:

The live cattle complex may have initially been trading lower this morning, but as the market nears the noon hour stronger tones have overcome the live cattle market. April live cattle are up $0.55 at $208.35, June live cattle are up $0.82 at $204.50 and August live cattle are up $1.40 at $201.42. Following the market's lower ascend on both Friday and Monday, traders now again sit in a better technical position as they are no longer up against immediate resistance pressure. From a fundamental standpoint, boxed beef prices are showing ample support, but no cash cattle trade has developed yet and won't likely develop until Friday. And yes, your choice cuts really are up over $7.00 this morning -- that's no April Fool's joke! Asking prices are noted in the South at $212 but are still not established or known for the North.

Boxed beef prices are higher: choice up $7.60 ($342.86) and select up $2.20 ($322.21) with a movement of 55 loads (32.81 loads of choice, 11.24 loads of select, 4.32 loads of trim and 6.62 loads of ground beef).

FEEDER CATTLE:

The feeder cattle complex is "feeling its oats" this morning as the market is charging mostly $2.00 higher into Tuesday's noon hour. The spot May contract is still about $2.00 lower than the market's resistance threshold, so it's likely that traders will be able to maintain their stronger tune throughout the afternoon without too much opposition. April feeders are up $1.77 at $288.22, May feeders are up $2.47 at $286.97 and August feeders are up $2.55 at $292.05.

LEAN HOGS:

Although pork cutout values are trading lower, the lean hog complex is also trading higher as the market is rallying on some of the positive energy stemming from the cattle complex's change in direction. April lean hogs are up $0.40 at $88.12, June lean hogs are up $2.57 at $97.85 and July lean hogs are up $2.47 at $98.30. The biggest hindrance to the morning's pork cutout value was the $4.75 decline in the belly.

The projected lean hog index for 3/31/2025 is up $0.15 at $88.65 and the actual index for 3/28/2025 is down $0.28 at $88.50. Hog prices are lower on the Daily Direct Morning Hog Report, down $0.37 with a weighted average price of $88.08, ranging from $85.00 to $90.00 on 338 head and a five-day rolling average of $87.92. Pork cutouts total 201.96 loads with 177.56 loads of pork cuts and 24.40 loads of trim. Pork cutout values: down $0.53, $96.92.

Tuesday Morning Livestock Market Update - Futures Find Little Direction

GENERAL COMMENTS:

Live cattle exhibited a second day of weakness Monday due to the uncertainty of the impact on demand once sweeping tariffs are implemented. There may be a limited impact on beef demand overall, but a decrease in exports would leave more beef available for domestic consumption and reduce beef prices somewhat. Canada and Mexico have begun discussions to revisit the USMCA agreement, with initial talks positive. Traders saw that the corn supply for the coming year should be plentiful. The Prospective Plantings report showed 95.326 million acres are estimated to be planted. Cattle were sold at steady to $1.00 lower last week in most cases, with a regional packer paying $10.00 higher for some cattle. The packer was short-bought and needed cattle. However, most business was done at steady to lower prices. This may have set the stage for this week, as feedlots may need to move cattle that they have been holding in hopes of higher prices. Boxed beef remains strong with choice up $2.44 and select up $1.33 on Monday.

Hog futures showed a large divergence with the April contract Monday, closing $1.02 higher, while later contracts closed lower. The April contract will expire on April 14 and is adjusting to the underlying cash. Hog traders are uncertain over the impact of the sweeping tariffs on international pork demand. The National Daily Direct Afternoon Hog report showed cash up $0.19. It is unusual for packers to bid higher for hogs on Monday. This may result in further cash gains Tuesday as they want to gain ownership early. Pork cutouts gained $0.89 with cutout values at $97.45.

	BULL SIDE		BEAR SIDE
1)	The implementation of sweeping tariffs leaves traders uncertain about international demand. However, it may have a limited impact on beef prices due to continued tight supplies.	1)	Cattle futures have not returned to contract highs after last week's bullish report. Price resistance may have been reached, leaving the market vulnerable to further selling pressure.
2)	Boxed beef prices remain strong and April is the beginning of the grilling season. This should support beef demand.	2)	Beef export sales were lower last week and sweeping tariffs could further impact international demand.
3)	Packers paying higher cash for hogs on Monday is a good sign that they may be short-bought and will pay more Tuesday as they procure sufficient hogs for slaughter.	3)	Hog futures are slowly trending lower with limited fundamental news supporting the market.
4)	The Easter season is coming and pork demand is higher during that time. Packers are preparing for increased demand.	4)	Traders would prefer to sell price rallies rather than buy the breaks. This continues to build strong technical resistance.