Cattle futures drop on broader market pressure
At the Chicago Mercantile Exchange, live cattle ended the day sharply lower on follow-through selling, and the decline in prices picked up steam after the Dow started to drop, there is ongoing concern about the overall impact of the coronavirus outbreak. Feeder cattle were lower on the same factors. The significantly lower start to cash trade does not bode well for cattle business this week. February live cattle closed $1.97 lower at $115.02 and April live cattle closed $2.30 lower at $122.95. March feeder cattle closed $3.05 lower at $132.97 and April feeder cattle closed $3.47 lower at $134.12.
Direct cash cattle trade is underway. A light dressed trade is taking place in Nebraska at mostly $187, $3 lower than last week’s weighted averages. A light live trade is underway in parts of the South at $115, $5 lower than last week’s weighted averages. The early rounds of business at significantly lower prices is likely due to another round of sharply lower cattle futures and pressure from outside markets due to the growing coronavirus concerns.
At the Joplin Regional Stockyards in Missouri, compared to last week steers and heifers under 600 pounds were $2 to $6 lower, over 600 pounds $5 to $7 lower. Nine-weight steers were $7 to $10 lower. The USDA says demand was moderate and supply was heavy. The uncertainty and unknowns with the coronavirus outbreak have all markets incredibly volatile right now. Receipts of 8,701 were up on the week and the year. Feeder supply included 60 percent steers and 53 percent of the offering was over 600 pounds. Medium and Large 1 feeder steers 654 to 695 pounds brought $136 to $150.50 and feeder steers 803 to 848 pounds brought $127 to $130.25. Medium and Large 1 feeder heifers 506 to 549 pounds brought $142 to $158 and feeder heifers 604 to 646 pounds brought $127.50 to $138.
Boxed beef closed mixed – firm on Choice and sharply lower on Select on light to moderate demand and offerings. Choice closed $.40 higher at $207.47 and Select closed $2.47 lower at $199.90. Estimated cattle slaughter is 124,000 head – up 1,000 on the week and 6,000 on the year.
Lean hog futures ended the day mixed on spread adjustments with concerns about the overall demand impact of the coronavirus outbreak. April lean hogs closed $.05 higher at $64.67 and May lean hogs closed $.10 higher at $71.97.
Cash hogs closed higher with heavy negotiated purchases. Cash hogs were able to muster some strength on hopes that demand for US pork will see a significant boost on the global market. However, that position isn’t on solid footing. The industry, overall, is concerned about the impact the coronavirus will have on the global demand picture. At the same time, supplies are heavy and that isn’t likely to change anytime soon. Barrows and gilts at the National Daily Direct closed $.89 higher with a base range of $45 to $51 for a weighted average of $49.60; the Iowa/Minnesota closed $1.04 higher for a weighted average of $49.56; the Western Corn Belt closed $1.06 higher for a weighted average of $49.55; the Eastern Corn Belt had no comparison but a weighted average of $49.73.
Butcher hogs at the Midwest cash markets are steady at $30. At Illinois, slaughter sow prices were steady with good demand for moderate offerings at $17 to $26. Barrow and gilt prices were steady at $27 to $35 with moderate demand for moderate offerings. Boras range from $5 to $13.
Pork values closed weak – down $.35 at $65.97. Bellies and ribs were lower. Hams and butts were weak. Loins closed steady. Picnics were higher. Estimated hog slaughter is 495,000 head – up 1,000 on the week and 22,000 on the year.