Market News

Cattle futures up sharply ahead of widespread direct trade

Chicago Mercantile Exchange live cattle futures were sharply higher, supported by technical buying as traders prepare for Friday’s USDA Cattle on Feed and Inventory reports, while getting ready for the week’s widespread direct cash cattle business. August was up $2.52 at $108.95 and October was $2.15 higher at $110.65.

Feeder cattle were up sharply, supported by the same factors as the live pit. August was $3.17 higher at $154.45 and September was up $2.95 at $154.65.

Direct cash cattle markets were generally very quiet. Packer inquiry has improved, but there’s still a lot of room in between the reported bids at $107 to $108 on the live basis and $170 to $173 dressed and the asking prices of $114 to $115 live and $180 to $183 dressed. Widespread business isn’t expected until at least Thursday, maybe even after Friday’s Cattle on Feed and Inventory numbers from the USDA. For the on-feed report, Allendale expects higher placements and total number of cattle on feed against lower marketings. At the Fed Cattle Exchange, the weekly offering was 428 head, all from Kansas, and 142 sold at $112, all for 1 to 9-day delivery.

Boxed beef closed modestly higher on moderate demand and offerings. Choice was up $.41 at $204.80 and Select was $.23 higher at $197.09. The estimated cattle slaughter of 119,000 head was down 1,000 on the week, but up 2,000 on the year.

At the Hub City Livestock Auction feeder cattle sale in South Dakota Wednesday, there were different weight classes on offer, so no comparison was made, but a higher undertone was noted. The USDA says the market was active and demand was good to very good, with the best demand on a string of attractive quality steers and heifers in light to moderate flesh. 58% of the feeder offering were steers and 100% of feeders weighed more than 600 pounds. Medium and Large 1 feeder steers weighing 800 to 900 pounds were reported at $151.75 to $153.75 and 900 to 1,000-pound steers brought $136 to $141.25. Medium and Large 1 feeder heifers weighing 860 pounds ranged from $134.50 to $135 and 950 to 980-pound heifers sold at $130.25 to $135.35.

Lean hog futures were mixed, with nearby contracts lower, on spread trade and demand uncertainties. The fundamentals during the session weren’t friendly, but contracts are carrying a significant discount to the cash index. August was down $.70 at $67.20 and October was $.27 lower at $51.92.

Cash hogs were steady to lower, with light to moderate closing negotiated numbers for the major direct markets. Buyers continued to press their leverage, while remaining wary of the expected expansion of market ready numbers and wholesale demand. While ready numbers did tighten along seasonal lines, supplies generally remained above year ago levels, putting a lot of pork on the market at a time when the industry is dealing with the effects of tariffs from some key U.S. trading partners. Even in instances where pork isn’t directly involved in the trade disputes, those tensions may be making some global buyers reluctant. The average Iowa/Southern Minnesota direct hog weight of 276.5 pounds was down 1.9 on the week and 0.3 on the year.

Pork closed $1.85 lower at $82.35. Bellies were up $.72, but the other primal cuts were weak to sharply lower, including losses of $3.39 for hams and $3.97 for loins. The estimated hog slaughter of 461,000 head was up 5,000 on the week and 20,000 on the year.

Iowa/Southern Minnesota direct barrows and gilts closed $1.13 lower at $70 to $73 for a weighted average of $70.93, the Western Cornbelt was down $1.21 at $67 to $73 with an average of $70.84, and national direct business was $1.36 lower at $67 to $73 for an average of $70.62. Butcher hogs at the Midwest cash markets were steady to $1 lower at $46 to $47.

Add Comment

Your email address will not be published.


 

Stay Up to Date

Subscribe for our newsletter today and receive relevant news straight to your inbox!