DTN Livestock Midday: Cattle Hold Back While Hogs Press Onward

    ©Debra L Ferguson Stock Photography

    As Monday rounds the corner and heads into the afternoon, the lean hog complex is hoping to keep its positive pace through the rest of the day’s trade.

    GENERAL COMMENTS:

    Heading into the new week, the cattle contracts are left trading without much direction or interest from traders. Meanwhile, the lean hog complex is back to trading higher after an extremely aggressive week last week.

    May corn is down 7 1/2 cents per bushel and May soybean meal is down $6.10. The Dow Jones Industrial Average is down 284.54 points and NASDAQ is down 45.72 points.

    LIVE CATTLE:

    It’s a grim Monday for the live cattle complex as the futures contracts are trading lower, boxed beef movement is lousy at 25 loads at midday and, with Friday’s hefty Cattle on Feed report, the market isn’t too optimistic about its nearby outcome given that supplies are about to become ample for market-ready cattle.

    April live cattle are down $0.37 at $140.10, June live cattle are down $1.15 at $136.22 and August live cattle are down $1.02 at $137.10. With supplies of market-ready cattle about to pressure the market, it’s incredibly important that throughput remains strong. Last week’s slaughter of 659,000 head was a relief, but the market needs to see that pace maintained in the weeks ahead.

    Seeing that the morning has only moved 25 loads is extremely odd; stay tuned to see what the afternoon’s boxed beef report does. New showlists appear to be mixed, higher in Nebraska/Colorado, but lower in Kansas and Texas. Feedlots will be pressured again this week as packers look to keep the cash market steady at best before supplies help them push prices lower.

    Last week’s negotiated cash cattle trade totaled 91,241 head. Of that 81% (73,927 head) were committed for nearby delivery while the remaining 19% (17,314 head) were committed for deferred delivery.

    Boxed beef prices are higher: choice up $1.02 ($263.66) and select up $1.50 ($253.64) with a movement of 25 loads (13.86 load of choice, 6.91 loads of select, zero loads of trim and 4.17 loads of ground beef).

    FEEDER CATTLE:

    The feeder cattle contracts are having a typical Monday, chopping sideways, and the market longs for direction and discernment. April feeders are down $0.60 at $160.97, May feeders are down $0.50 at $165.27 and August feeders are down $0.22 at $178.22. The grain contracts are trending lower into Monday afternoon, but that doesn’t just give the feeder cattle complex the green light to trade higher.

    The market knows, come the second half of the year, supplies are going to be thin, and that demand should boost prices higher. But in the meantime, feedlot managers are having to take a good look at their bottom line amid high feed prices and a volatile live cattle market and are trying to see where the price point for calves/feeders falls.

    LEAN HOGS:

    The lean hog complex has seen trade on both sides of steady thus far through Monday, but as the day presses on the complex is gaining strength and trending fully higher into the afternoon. You can’t put much faith into the midday pork cutout value; but seeing that it’s trending $3.50 higher already sets a strong tone.

    Meanwhile, the cash hog market isn’t as friendly as packers aren’t willing to pay whatever the cost is at this point in the week’s cash hog market, like they did last week. April lean hogs are up $0.70 at $108.17, June lean hogs are up $0.62 at $126.47 and July lean hogs are up $0.52 at $125.82.

    The projected CME Lean Hog Index for 3/25/2022 is up $0.68 at $102.93, and the actual index for 3/24/2022 is up $0.75 at $102.25. Hog prices are lower on the Daily Direct Morning Hog Report, down $7.17 with a weighted average of $103.11, ranging from $98.00 to $110.00 on 3,583 head and a five-day rolling average of $104.79. Pork cutouts total 150.48 loads with 123.97 loads of pork cuts and 26.51 loads of trim. Pork cutout values: up $3.50, $113.40.

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