The live cattle and feeder cattle contracts are struggling as the market’s pressure seem to outweigh its current strength.
The cattle contracts are faced with the same pressure that Tuesday posed as the corn market traders higher and the cash cattle market is waiting the week out, hoping to muster higher prices again this week. Meanwhile, the lean hog contracts are trading higher and are looking to keep these positive gains, hopefully through the day’s close. May corn is up 15 1/4 cents per bushel and May soybean meal is up $2.70. The Dow Jones Industrial Average is up 207.21 points and NASDAQ is down 25.55 points.
The live cattle complex is caught trading lower as the market neglects to find any interest from traders at this point in the day. April live cattle are down $0.22 at $122.17, June live cattle are down $0.57 at $120.32 and August live cattle are down $0.60 at $120.30. The online auction didn’t summon any reasonable bids from packers and the countryside still sits quietly without bids having surfaced as of yet. Feedlots know that if they want higher prices this week, it’s going to be by patiently waiting and drawing the week’s trade out until Thursday or Friday. Asking prices in the South are marked at $125 and in the North from $200 to $205. Packers could begin to show more interest as the day rolls into the afternoon.
The Fed Cattle Exchange Auction listed a total of 3,966 head (Nebraska 2,067 head, Texas 1,862 head and 37 head in Kansas), of which none actually sold as they did not meet the reserve prices that ranged from $122 to $128. Opening prices ranged from $120.50 to $128; high bids ranged from $120.50 to $126.
Boxed beef prices are higher: choice up $2.18 ($272.29) and select up $1.36 ($267.90) with a movement of 75 loads (39.10 loads of choice, 10.77 loads of select, 16.01 loads of trim and 9.46 loads of ground beef).
As corn prices keep scaling higher the feeder cattle contracts are feeling pretty doom and gloom as input costs are sucking profits away rather quickly from feedlots’ bottom line. April feeders are down $1.25 at $141.20, May feeders are down $1.55 at $145.77 and August feeders are down $1.52 at $156.62. Technically speaking, the feeder cattle contracts have plenty of room for opportunity and upside potential, the market’s ability to trade higher is only going to surface if pressure from higher inputs lessens or if cash cattle begin to trade higher again this week.
While the cattle contracts are floundering lower, the lean hog contracts are determined to keep their upward surge. June lean hogs are up $0.65 at $106.87, July lean hogs are up $0.32 at $104.60 and August lean hogs are steady at $100.25. The cash hog market may be slightly lower, but cutouts are still showing favorable demand. There has been some maintenance issues at pork plants this week, which is accredited to Monday’s revised slaughter. The slightly weaker slaughter isn’t expected to be great enough to backup hog supplies, but it could slow packer aggression in the cash market until plants are back to full capacity.
The projected lean hog index for April 13 is up $0.32 at $102.69, and the actual index for April 12 is up $0.48 at $102.37. Hog prices are lower on the National Direct Morning Hog report, down $0.22 with a weighted average of $99.74, ranging from $97.00 to $103.00 on 6,365 head. Pork cutouts total 174.67 loads with 159.94 loads of pork cuts and 14.73 loads of trim. Pork cutout values: up $0.76, $113.25.