Market News

Cattle futures down on cash, wholesale pressure

 

Chicago Mercantile Exchange live cattle futures closed lower in slow trade, pressured by the lower midday boxed beef, along with early, lower than a week ago direct business in the South. There’s also position squaring ahead of Friday’s USDA Cattle on Feed report. The numbers could be bearish, but that could already be factored in for futures, which are significantly below recent cash prices. April was down $.65 at $119.57 and June was $1.15 lower at $109.00.

Feeder cattle were lower on cash and wholesale pressure, with nearby contracts unable to follow through on the modest midday gains. March was $.67 lower at $137.77 and April was down $.75 at $137.45.

Light to moderate direct cash cattle business developed in the South by Tuesday afternoon. Sales were reported mostly at $126 on the live basis, generally $1 lower than last week, with lighter live business in Colorado, also at $126. A handful of dressed sales were reported in the North at $203 to $204 dressed. DTN says the Nebraska business had a three-week delivery date, while the dressed sales in Iowa were for delivery Monday, March 26th. More business is left to be done, most of it probably in the North. Asking prices in that region were around $208 with bids at $202 to $204. This week’s Fed Cattle Exchange offering is 166 head, with results out Wednesday.

Boxed beef closed lower on light to moderate demand and moderate offerings. Choice was down $1.52 at $223.35 and Select was $.55 lower at $216.74. The estimated cattle slaughter of 118,000 head was unchanged on the week and up 1,000 on the year.

At the Kingdom City-Callaway Livestock Center cattle sale in Missouri, compared to last week’s lighter offering of mostly yearling steers weighing more than 650 pounds, steer calves weighing less than 600 pounds were lightly tested with a sharply lower undertone, while 650 to 700-pound steers were mostly $3 to $6 lower and 700 to 750-pound steers, along with a pot load of 860 yearlings were steady to $2 lower. Good quality heifer calves with a good vaccination program weighing less than 600 pounds were steady with good demand, but feeders weighing more than 600 pounds were weak to lower in a light test. Medium and Large 1 feeder steers weighing 700 to 800 pounds ranged from $134.25 to $164.75 and Medium and Large 1 to 2 steers weighing 500 to 600 pounds brought $155 to $177. Medium and Large 1 feeder heifers weighing 600 to 700 pounds sold at $143.50 to $145 and 700 to 800-pound heifers were reported at $132 to $140.25.

Lean hog futures were mostly modestly lower on spread trade, the steady to lower cash during the session, and position squaring relative to the cash index. The higher midday pork cutout did provide some initial support, but there’s a lot of pork available and early spring can be a slow time for pork demand. April was the only contract in the black, up $.10 at $63.25 and June was down $.07 at $76.75.

Cash hogs were steady to lower, with strong closing negotiated sales at the major direct markets. Buyers were able to put more pressure on business, helped by plenty of ready numbers and volatility in wholesale trade. There’s a lot of pork on the market, with February’s livestock slaughter and cold storage reports both out Thursday afternoon. There are also uncertainties about export demand connected to trade issues. NAFTA is less of a concern, but there are rumblings about potential retaliation from China and the European Union.

Pork closed $.09 higher at $72.07. Loins were up $1.42 and ribs were $.04 higher, while butts, picnics, hams, and bellies were weak. The estimated hog slaughter of 464,000 head was up 3,000 on the week and 18,000 on the year.

Iowa/Southern Minnesota direct barrows and gilts closed $.56 lower at $53.50 to $57 for an average of $55.75, the Western Cornbelt was down $.60 at $53.50 to $57 with an average of $55.68, and national direct business was $.68 lower at $51 to $57 for an average of $55.73. The Eastern Cornbelt had no recent comparison with a range of $51 to $56.73 and an average of $55.80. Butcher hogs at the Midwest cash markets were steady at $36 to $40. Missouri direct butchers were steady at $50 to $51 on light to moderate supply and demand. Sows were steady to $5 lower at $28 to $44. Illinois direct sows were $5 lower at $30 to $45 on light to moderate demand for moderate to heavy offerings. Barrows and gilts were $1 lower at $35 to $40 on light to moderate demand for moderate offerings. Boars ranged from $9 to $22.