Market News

Waiting game continues ahead of cash cattle business

At the Chicago Mercantile Exchange, live cattle futures closed mostly lower, but the nearby contracts closed firm ahead of widespread direct cash business.  There is also concern about long-term supply and demand issues.  August live cattle closed $.20 higher at $109.27 and October live cattle closed $.02 higher at $110.47.  August feeder cattle closed $.45 lower at $149.17 and September feeder cattle closed $.10 lower at $151.00.

Direct cash cattle trade remains quiet as both bids and asking prices are poorly defined.  Look for more activity to begin to take shape Wednesday afternoon, but if the market follows recent weeks – significant trade volume isn’t likely to develop until Friday.  The Fed Cattle Exchange has an offering of 359 head and Cattle on Feed report comes out on Friday.

At the Callaway Livestock Center in Missouri, receipts are down on the week.  Compared to last week steer calves under 600 pounds and yearling steers over 700 pounds were lightly tested but sold with a firm to higher undertone with 600 to 700-pound steers firm to $3 higher.  Feeder heifers under 550 pounds were lightly tested with last week, heifers 550 to 700 pounds were steady to $4 higher.  The USDA says demand was good on a moderate supply with a good offering of steer calves and yearlings all selling with active buying support.  Feeder supply was 55 percent steers and bulls and 46 percent of the offering was over 600 pounds.  Medium and Large 1 feeder steers 500 to 550 pounds were $178.50 to $186 and feeder steers 600 to 700 pounds were $169 to $178.50.  Feeder heifers 500 to 600 pounds were $153 to $158 and feeder heifers 600 to 700 pounds were $150 to $157.50.

At the Manchester Livestock Auction in Iowa, receipts totaled 844 head.  Both steers and heifers trended $1 lower.  Feeder steers brought $110 to $113.50 and feeder heifers brought $109 to $112.75.

Boxed beef cutout values closed mixed – weak on Choice and higher on Select on light to moderate demand and offerings.  Choice down $.41 at $213.57 and Select up $1.79 at $204.08.  The Choice/Select spread is $9.49.  Estimated cattle slaughter is 119,000 head – even on the week and up 1,000 on the year.

Lean hog futures closed mostly higher, but the nearby contracts ended the day weak on short covering and position squaring ahead of this week’s Cold Storage report.  Contracts are at a premium to cash.  The market is also banking on increased pork exports to Mexico following trade discussions.  October lean hogs closed $.25 lower at $56.22 and December lean hogs closed $.32 lower at $53.90.

Cash hogs closed lower.  There is still some concern about the large supply and weak demand picture.  This is the second day in a row estimated slaughter numbers have been reduced.  Barrows and gilts at the Iowa/Southern Minnesota closed $.83 lower with a range of $38 to $40 for a weighted average of $39.46; the Western Corn Belt closed $.78 lower with a range of $37 to $40 for a weighted average of $39.44; the Eastern Corn Belt was not reported due to confidentiality; and the National Daily Direct closed $.75 lower with a range of $37 to $40 for a weighted average of $39.43.

Butcher hogs at the Midwest cash markets are steady in Dorchester, Wisconsin and Garnavillo, Iowa at $27.  The market at Zumbrota, Minnesota is not established yet.  At Illinois, slaughter sow receipts are down on the week and the year.  Prices are weaker at $17 to $32 with light to moderate demand for moderate offerings.  Boars under 300 pounds are $10 to $15 and boars over $300 pounds are $5 to $8.  Barrows and gilts are steady at $18 to $30 with light to moderate demand for moderate offerings.

Pork cutout values closed lower – down $.99 at $66.19.  The primals are mostly lower – the hams, loins, bellies, and picnics were all lower.  Butts were firm and ribs closed higher.  Estimated hog slaughter is 467,000 head – down 1,000 on the week and up 22,000 on the year.