DTN Midday Livestock Comments 05/13 11:39
Feeder Cattle and Hogs Look to Recover Some of Thursday's Lost Position
The feeder cattle and lean hog contracts are attempting to regain some of
the market share that Thursday threw away, but the live cattle complex isn't as
confident as its market has other hurdles to face.
DTN Livestock Analyst
After Thursday's blood bath, the livestock contracts were sheepish in how
they approached Friday's market, but upon thorough evaluation, traders have
deemed it safe and are now letting the feeder cattle and lean hog contracts
trade slightly higher, but the live cattle contracts aren't as confident. July
corn is down 11 3/4 cents per bushel and July soybean meal is up $9.50. The Dow
Jones Industrial Average is up 507.86 points.
Little interest in the cash cattle market, immense pressure throughout the
futures market and a wavering consumer base (when historically prices would be
rallying higher for grilling weather) all has the live cattle complex holding
its breath. With its counterparts, the feeder cattle and lean hog contracts,
are trading higher the live cattle market isn't as sure and continues to trade
mostly lower. June live cattle are up $0.32 at $131.97, August live cattle are
down $0.05 at $132.72 and October live cattle are down $0.37 at $139.47. The
cash cattle market hasn't seen any renewed interest and it's looking like the
bulk of this week's trade is done with. This week's movement hasn't amounted to
much compared to the last three weeks' worth of trade, and all eyes will be
looking for Monday's report to see exactly how many cattle traded. Throughout
the week, Southern live cattle have traded for $140 and Northern dressed cattle
Boxed beef prices are mixed: choice up $1.23 ($258.43) and select down $0.52
($243.84) with a movement of 59 loads (31.52 loads of choice
The feeder cattle contracts are feeling confident in their upward move as
the corn market is chopping sideways with a $0.05 to $0.08 regression in its
nearby contracts. Sales throughout the countryside have been thin as it's too
soon for new-crop calves to be working their way into the market, and largely
most of last year's calves have already traded. Come the first part of June,
the market will see some of the industry's biggest auction houses hosting their
early summertime sales and we'll begin to get a better understanding of what
feeder cattle prices are going to bring this fall. May feeders are up $0.90 at
$157.77, August feeders are up $1.35 at $167.87 and September feeders are up
$0.87 at $170.55.
After a less than desirable week, the lean hog complex is seeing support
work its way into its nearby contracts, but the deferred contracts are still
traipsing lower after noting the expectation of larger supplies come 2023. June
lean hogs are up $2.45 at $99.92, July lean hogs are up $2.75 at $100.62 and
August lean hogs are up $2.07 at $101.05. As the market continues to yearn for
a clearer understanding of what the near-term market is supposed to be, it's
likely that Friday's trade keeps a higher tone through the day's end but then
will search for reassurance again next week.
The projected lean hog index for May 12 is up $0.55 at $100.49, and the
actual index for May 11 is down $0.22 at $101.04. Hog prices are lower on the
Daily Direct Morning Hog Report, down $3.68 with a weighted average $101.27,
ranging from $98.00 to $107.75 on 2,758 head and a five-day rolling average of
$104.93. Pork cutouts total 175.87 loads with 163.74 loads of pork cuts and
12.13 loads of trim. Pork cutout values: down $0.39, $98.21.
ShayLe Stewart can be reached firstname.lastname@example.org
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