Market News

Cattle futures fall ahead of cash trade

At the Chicago Mercantile Exchange, cattle futures closed lower on profit taking and pressure from outside markets.  The lack of cash activity is also not providing any support.  December live cattle closed $.92 lower at $117.14 and February live cattle closed $.55 lower at $121.92.  November feeder cattle closed $1.05 lower at $155.87 and January feeder cattle closed $.87 lower at $150.85.

Direct cash cattle trade is at a standstill.  Packer inquiry remains very light with a few scattered bids reported in Eastern Nebraska at $174 dressed.  Asking prices haven’t been established yet.  There were a handful of deals in Iowa at $174.  Look for significant trade volume to develop in the latter half of the week. Wednesday’s Fed Cattle Exchange has an offering of 1051 total head.

At the Tri-state Livestock Auction in Nebraska, receipts are up on the week and the year.  Compared to last week steers under 450 pounds were steady, 450 to 600 pounds were $10 to $15 lower, and over 600 pounds were $7 to $8 lower.  Heifers 450 to 500 pounds were $6 higher, over 500 pounds were $4 to $5 lower.  The USDA says demand was moderate most of the day.  The biggest decline in prices were calves that had yet to receive their preconditioned shots.  Feeder supply included 61 percent steers and 31 percent of the offering was over 600 pounds.  Medium and Large 1 feeder steers 501 to 542 pounds brought $165 to $177 and feeder steers 604 to 646 pounds brought $155 to $167.50.  Medium and Large 1 feeder heifers 501 to 548 pounds brought $149.50 to $163 and feeder heifers 551 to 591 pounds brought $143 to $153.50.

Boxed beef cutout values closed mixed.  Higher on choice and lower on Select on light to moderate demand and offerings.  Choice up $1 at $210.28 and Select down $.80 at $196.86.  The Choice/Select spread is $13.42.  Estimated cattle slaughter is 119,000 head – even on the week and up 2,000 on the year.

Lean hog futures closed higher on follow through commercial buying.  Additional cases of African Swine Fever in China indicate the outbreak isn’t contained and could help shore up demand support and price strength down the road.  Nearby contracts are at a discount to cash.  December lean hogs closed $1.25 higher at $54.52 and February lean hogs closed $1.12 higher at $61.42.

Closing cash hog prices were not available due to packer submission problems.  However, cash hogs were firm at midday with solid negotiated purchase numbers.  Packers still have the upper hand as slaughter runs are large and hogs are at heavier weights.  The market continues to struggle with demand uncertainty.  More cases of African Swine Fever continue to surface.  Should it cause a major disruption to the global pork supply, it could eventually provide support to US pork prices.  Barrows and gilts at the Iowa/Southern Minnesota opened $.56 higher with a range of $51 to $58.50 for a weighted average of $58.19; the Western Corn Belt opened $.61 higher with a range of $51 to $58.50 for a weighted average of $58.15; the Eastern Corn Belt was not reported due to confidentiality; and the National Daily Direct opened $.05 higher with a range of $51 to $58.50 for a weighted average of $57.99.

Butcher hogs at the Midwest cash markets are $1 and $2 lower at $37 and $42.  At Illinois, slaughter sow receipts are down on the week and the year.  Prices are $1 higher at $29 to $42 with moderate demand for moderate offerings.  Barrow and gilt prices are steady at $32 to $42 with moderate demand for moderate offerings.

Pork cutout values closed weak – down $.53 at $77.86.  The bellies and the picnics were sharply lower.  Hams and butts were higher. Estimated hog slaughter is 477,000 head – even on the week and up 19,000 on the year.