Cattle futures lower ahead of widespread direct business

Market News

Cattle futures lower ahead of widespread direct business

At the Chicago Mercantile Exchange, live and feeder cattle ended the day lower ahead of the week’s direct cash business.  February live cattle closed $.55 lower at $116.45 and April live cattle closed $.47 lower at $122.62.  January feeder cattle closed $.02 lower at $135.62 and March feeder cattle closed $1.40 lower at $140.07. 

Direct cash cattle trade activity picked up on Wednesday, but no deals were made.  Bids were floated at $112 live in the South and $173 dressed in the North.  Asking prices were at $115 plus live in the South and $182 to $185 dressed in the North.  It’s likely significant trade volume will develop over the balance of the week. 

At the Ozarks Regional Stockyard in Missouri, compared to last week, steer calves under 700 pounds were $4 to $8 higher with heavier weights steady to $2 higher.  Heifer calves traded $3 to $6 higher.  The USDA says demand was good on a moderate supply and quality was about average.  Receipts are about steady on the week and up slightly on the year.  Feeder supply included 62 percent steers and 49 percent of the offering was over 600 pounds.  Medium and Large 1 feeder steers 618 to 644 pounds brought $143 to $155.50 and feeder steers 707 to 741 pounds brought $131.50 to $136.50.  Medium and Large 1 feeder heifers 550 to 589 pounds brought $128 to $138 and feeder heifers 600 to 649 pounds brought $124 to $137. 

Boxed beef closed higher on good demand for moderate offerings.  Choice closed $.60 higher at $229.66 and Select is $1.66 higher at $218.99.  The Choice/Select spread is $10.67.  Estimated cattle slaughter is 119,000 head – down 1,000 on the week and down 5,000 on the year. 

Lean hog futures ended the day mixed on spread adjustments.  Pork values during the session provided some support, but the industry still has long-term demand concerns.  February lean hogs closed $.12 higher at $70.57 and April lean hogs closed $.65 lower at $76.30. 

Cash hogs closed higher with a moderate negotiated run. Packers bid up to move some numbers Wednesday afternoon.  However, the industry continues to monitor supply and demand.  The availability of market-ready barrows and gilts is more than ample, and processors continue to push daily slaughter totals higher.  That’s keeping supply chains moving, but it’s also adding more pork to an already saturated market.  Demand has been strong, but there is concern strength in both domestic and global markets could wain as the impacts of the coronavirus pandemic continue.  Barrows and gilts at the National Daily Direct closed $.58 higher with a base range is $51 to $59 and a weighted average of $56.75.  The Iowa/Minnesota closed $.78 higher with a weighted average of $57.51 and the Western Corn Belt closed $.64 higher with a weighted average of $57.50.  Prices at the Eastern Corn Belt were not reported due to confidentiality.

Butcher hog prices at the Midwest cash markets are steady at $40.  At Illinois, slaughter sow prices were $2 higher with good demand for heavy offerings at $34 to $46.  Barrow and gilt prices were firm with good demand for moderate to heavy offerings at $34 to $39.  Boars ranged from $15 to $20 and $5 to $10. 

Pork values closed firm – up $.18 at $81.11.  Hams and ribs closed sharply higher.  Bellies, butts, and loins were sharply lower.  Picnics closed weak.  Estimated hog slaughter is 492,000 head – down 6,000 on the week and down 3,000 on the year.  Tuesday’s hog slaughter has been revised to 449,000 head.