All three livestock contracts dip lower as pressure starts to set into the marketplace.
As the noon hour approaches the entire livestock complex tips lower. Cattle contracts started the day enthused and ready to trade higher but as time progressed pressure grew and even the live cattle and feeder cattle markets are now trading red.
The lean hog market wasn’t as optimistic about the day as the complex started trading lower from the day’s start and continues to trade lower into the noon hour.
May corn is up 4 cents per bushel and May soybean meal is down $3.30. The Dow Jones Industrial Average is up 840.56 points and NASDAQ is up 89.84 points.
As cash cattle trade begins to develop and as the board starts to weaken, it will be interesting to see how the market handles the two shifts. Live cattle contracts are nearing the noon hour mostly lower and are seeing the biggest losses in the deferred contracts.
April live cattle are up $3.57 at $109.72, June live cattle are up $0.27 at $97.27 and August live cattle are down $0.37 at $97.87. Of the deferred contracts trading lower, losses range anywhere form $0.42 to $4.47 lower.
Cash cattle trade has lightly started to develop outside of the Fed Cattle Exchange. Some business started in the South at $118 to $120 live, which is sharply higher than last week’s weighted averages of $109 to $110.
The Fed Cattle Exchange Auction Wednesday morning reported a total of 5,886 total head, consisting of 38 lots:
- 12 lots in Nebraska consisting of 1,649 head, of which one lot sold at $120, three lots were offered $117 but that offer was passed;
- 12 lots in Kansas, 1,865 head of which eight lots sold $118.25 to $120.50, one lot was offered $117 but was passed;
- eight lots in Colorado, 1,179 head of which one lots sold at $115;
- four lots in Texas, 896 head, three lots sold at $119 to $119.50, one lot was offered at $117.75 but was passed;
- three lots in Oklahoma, 297 head, two lots sold at $118 to $118.25, one lot was offered at $117 but was passed.
Of the 5886 head total 2,451 head sold, live offering 1-9 day delivery 2,638 head total, of those 1,614 head sold with a weighted average price of $119.77, 1-17 day delivery 3,248 head total, 837 head sold, with a weighted average of $117.73. Asking prices ranged from $115 to $125, actual sales range was $115 to $120.50.
Boxed beef prices are higher: choice up $0.17 ($256.48) and select up $0.21 ($245.69) with a movement of 84 loads (40.98 loads of choice, 11.77 loads of select, 8.82 loads of trim and 22.70 loads of ground beef).
Feeder cattle contracts are weakening as the day progresses and giving up as much as $3.00 to $5.00 depending on the contract. April feeders are down $2.90 at $127.17, May feeders are down $2.25 at $127.25 and October feeders are down $3.75 at $133.57.
The market’s pressure obviously stems from the uncertainty of the COVID-19 virus but after four strong days of higher price movements the board could also be resting its upward movement.
The lean hog market’s weakness circles the whole marketplace as the board opened weaker, cash prices are lower and cutout values are lower as well. April lean hogs are down $0.77 at $66.65, June lean hogs are down $1.62 at $71.37 and July lean hogs are down $1.35 at $73.35.
It wouldn’t be surprising to see the lean hog market continue with its lower trade throughout the day as all sides of the market are bearing lower.
The projected lean hog index for 3/24/2020 is up $1.14 at $65.12, and the actual index for 3/23/2020 is up $0.80 at $63.98. Hog prices on the National Direct Morning Hog Report are $0.08 lower with a weighted average of $59.13, ranging from $55.00 to $62.50 on 7,596 head sold and five-day rolling average of $57.36.
Pork cutouts totaled 183.94 loads with 160.28 loads of pork cuts and 23.66 loads of trim. Pork cutout values: down $2.60, $79.45.