Cattle futures supported by wholesale prices
At the Chicago Mercantile Exchange, live cattle ended the day higher on the strength in wholesale values and optimism surrounding potential resolution to the supply chain issues. Feeder cattle were higher on the same factors as the live pit. June live cattle closed $.65 higher at $84.70 and August live cattle closed $.12 higher at $90.52. May feeder cattle closed $.35 higher at $118.50 and August feeder cattle closed $.65 higher at $127.92.
A light direct cash cattle trade has developed. A handful of dressed deals have been in Nebraska at $150, about $4 lower than last week’s weighted average basis in Nebraska. Bids are still few and far between in other areas. Asking prices are around $110 plus live in the South and $160 dressed in the North. It’s likely significant trade volume will be delayed until the latter half of the week. Wednesday’s Fed Cattle Exchange has an offering of 4132 head.
At the Sioux Falls Regional Cattle Auction in South Dakota, compared to last week feeder steers are $2 to $4 lower. Feeder heifers under 600 pounds were not well compared, 600 to 700 pounds were $5 to $10 lower, and over 700 pounds were steady to $3 lower. The USDA says demand was moderate for the nice offering of feeder cattle and many long-strings of high-quality yearling steers and heifers carried a light to moderate flesh. The market wasn’t as active as cattle feeders are facing a lot of uncertainty. The most active market was on the packages of light-weight cattle. Receipts were up on the week and almost even on the year. Feeder supply was 81 percent steers and 93 percent of the offering was over 600 pounds. Medium and Large 1 feeder steers 855 to 898 pounds brought $114.50 to $124.50 and feeder steers 909 to 941 pounds brought $113 to $120. Medium and Large 1 feeder heifers 667 to 684 pounds brought $121.50 to $129 and feeder heifers 814 to 843 pounds brought $108.50 to $115.50.
Boxed beef closed sharply higher on heavy demand for moderate offerings. Choice is $18.98 higher at $330.82 and Select is $22.10 higher at $320.88. Estimated cattle slaughter is 76,000 head – down 8,000 on the week and down 45,000 on the year. Monday’s cattle slaughter has been revised to 77,000 head.
Lean hog futures ended the day mostly higher on follow-through buying with support from sharply higher wholesale values during the session. May lean hogs closed $1.22 lower at $55.05 and June lean hogs closed $.92 higher at $56.20.
Cash hogs closed higher with moderate negotiated numbers. Packers had to bid up to move their desired numbers today. While this might be a blip on the radar for cash prices, it’s much needed. However, the cash market remains under pressure as pork processors are struggling to keep a healthy labor force as COVID-19 outbreaks continue. The President is expected to invoke the Defense Production Act and order the nation’s meat processing plants to remain open. That should eventually help to alleviate some of the pressure on the nation’s pork producers. Barrows and gilts at the National Daily Direct closed $1.21 higher with a base range of $32 to $40 for a weighted average of $36.17; the Iowa/Minnesota closed $5.52 higher for a weighted average of $38.68; the Western Corn Belt had no comparison but closed with a weighted average of $38.68. The Eastern Corn Belt was not reported due to confidentiality.
Butcher hog prices at the Midwest cash markets area steady at $24. Garnavillo, Iowa is closed today. At Illinois, slaughter sow prices were weak with good demand for heavy offerings at $12 to $25. Barrow and gilt prices were steady with light demand for heavy offerings at $10 to $15. Boars brought $2 to $5.
Pork values closed sharply higher – up $4.78 at $88.49. Butts and bellies both closed more than $10 higher. Ribs, picnics, and loins were also sharply higher. Hams were weak. Estimated hog slaughter is 283,000 head – down 71,000 on the week and down 188,000 on the year. Monday’s hog slaughter has been revised to 303,000 head.