Market News

Beef cutouts close sharply lower

The late month fed cattle offering appears to be smaller than last week with only Nebraska distributing larger showlists on Monday. It was a typical Tuesday in cattle country with bids and asking prices not yet established. Significant trade volume will most likely not develop until sometime Wednesday or later. But with the holiday weekend ahead both sides may want to complete trade as early as possible. Tuesday’s cattle slaughter is estimated at 117,000 head, 2,000 more than last week, and 5,000 greater than last year.

Boxed beef cutout values were lower to sharply lower on light to moderate demand and offerings. Choice beef 245.74, down 2.14, select 221.17, down 1.66.

Live cattle contracts on the Chicago Mercantile Exchange settled unchanged to .85 lower as pressure developed in the market near midday. Light trade volume was seen across the complex. June futures remained at 123.00 per hundredweight as traders appeared to be focused on position adjustments due to overall lack of volume in the market.

Feeder cattle settled unchanged to 1.27 lower. The complex was under pressure following the softness that developed in the live cattle market. Traders pulled back from the sharp triple digit gains that developed on Monday.

Joplin, Missouri Regional stockyards on Monday had receipts of 6,023 feeder cattle. Compared to last week, steers and heifers of all weights sold unevenly steady, with price ranges of most weights of cattle trading within a dollar or two on either side of last week’s spreads. Solid gains on the Chicago Mercantile Exchange lent some support as futures gained back a little of the significant losses experienced the past couple of weeks. The supply was moderate with moderate to good demand. Feeder steers medium and large 1 averaging 619 pounds traded at 164.76 per hundredweight. 618 pound heifers averaged 143.61.

Lean hogs settled .02 to .80 higher as the market rallied higher as strong buyer support quickly moved back into the complex. The support held June and July futures above the $80 per hundredweight levels, which sparked renewed underlying support in all nearby contracts. Additional fundamental support also developed with firm cash gains in the national report and a strong market advance in the pork cutout value.

Barrows and gilts in the Iowa/Minnesota direct trade closed .74 higher at 71.56 weighted average on a carcass basis, the West was up .66 at 71.41, and nationally the market was .56 higher at 71.66. Missouri direct base carcass meat price closed 2.00 lower to 1.00 higher at 64.00. Illinois direct hogs on a live basis were weak from 46.00 to 52.00, sows were 1.00 lower from 38.00 to 51.00.

The pork carcass cutout value was up 1.59 at 90.30 in the afternoon report. Ribs and belies were up the most.

Given the fact that pork processors are planning to slaughter virtually nothing on Saturday, their appetite for live inventory is likely to peak early in the weak.

The Tuesday hog kill was estimated by USDA at 440,000 head 1,000 more than last week, and 10,000 greater than last year.