Market News

Cattle trade at higher prices

DTN reported a light cattle trade was evident in several areas on Friday afternoon. Dressed sales in the North were mostly 267.00, $2.00 to 3.00 higher than last week. A few deals were evident in Texas at 172.00, $4.00 higher than last week’s test. Many showlists continued to be priced on a firm basis, 174.00 plus South, and 270.00 plus North. The weekly cattle kill was estimated at 567,000 head, 7,000 above the previous week, but 54,000 less than last year.

The boxed beef cutout values were steady on choice and lower on select on light demand and offerings. Choice beef was down .17 at 255.52, and select was down 1.06 at 241.93.

Chicago Mercantile Exchange live cattle contracts settled 12 to 110 points higher. The early pressure in the live pit evaporated as traders not only tried to prepare for the afternoon cattle on feed report, but also pointed to steady to firm potential in the cash cattle trade. Deferred futures once again set new contract highs, which puts more emphasis on the longer term support in the market and expectations supplies will remain tight over the next year. December settled .65 higher at 170.90, and February was up .32 at 172.15.

Feeder cattle ended the session 50 to 130 points higher. The feeder futures turned higher at midday following the renewed support in the live pit. There was additional pre-report positioning. Although the overall volume in the market remained sluggish. January settled .77 higher at 236.35, and March was up .72 at 234.45.

Feeder cattle receipts at Missouri auctions this week totaled 26,761 head. Compared to last week, feeder steers and heifers traded mostly steady to 5.00 higher, although some barns saw calves selling steady to weak. Demand around the state was good, and the supply was moderate. Many barns saw good quality calves, allowing buyers to be selective. 1241 head of feeder steers, medium and large 1 averaging 576 pounds averaged 273.79 per hundredweight. 678 head of feeder heifers with an average weight of 575 pounds traded at 242.92.

Lean hog contracts settled 45 lower to 70 points higher with only the two front months in the red. Price shifts through the complex limited any sense of direction between nearby and deferred issues. The mid to late 2015 contracts held on to strong gains. December was down .12 at 90.65, and February was .45 lower at 90.45.

Barrows and gilts in the Iowa/Minnesota direct trade closed.69 higher at 86.48 weighted average on a carcass basis, the West was .62 higher at 86.29, and the East was .05 higher at 84.07. The Missouri direct base carcass meat price was steady from 77.00 to 81.00. Hogs at Midwest markets were steady to 2.00 higher from 60.00 to 66.00 on a live basis.

The pork carcass cutout value was .23 lower at 93.39 FOB plant. Picnics, hams, and bellies were higher.

Pork processors have watched margins significantly erode over the last week or so. Packers either need to buy hogs lower or slow chain speed to force wholesale prices higher.  

The weekly hog slaughter was estimated at 2,232,000 head, 13,000 more than last week, but down 114,000 from last year.