Market News

Feeder cattle trend lower at Oklahoma City

Chicago Mercantile Exchange live cattle contracts settled mostly higher after struggling most of the session, but ended firmer due to late short covering. Higher corn values leant additional support to the deferred issues. August settled 17 points higher at 84.70, and September was up 45 at 90.20. Boxed beef cutout values closed firm on light to moderate demand and offerings. Choice beef was up .23 at 143.08, and select was .54 higher at 137.25.

Feeder cattle settled unchanged to 47 points lower partly on stronger corn values. Even though there were no major surprises in the cattle on feed report, the lack of significant good news hit the market in the face as reality continues to sink in that that supply levels may be very strong given the weak consumer demand for meat. August finished 15 points lower at 102.40, and September was unchanged at 102.35.

Feeder cattle receipts at the Oklahoma National Stockyards totaled 9400 head on Monday. Compared to last week feeder steers and heifers were steady to 2.00 lower. Demand was moderate to good. Steer and heifer calves were not well tested at midsession. The quality was less attractive than last week. There were several cattle available from the East and many of these were crossbreds. Feeder steers medium and large 1 weighing 700 to 800 pounds traded from 100.50 to 103.50. 7 to 8 weight heifers brought 92.75 to 99.50 per hundredweight.

Monday’s cattle slaughter was estimated at 125,000 head, 1,000 more than last week, and 1,000 less than last year. Cattle formula and trade volume totals for last week were mixed, larger in Kansas and Texas, but smaller in Nebraska. The new show lists are generally unchanged in Texas, but smaller in Kansas, Nebraska and Colorado. Early asking prices are expected to be around 85 in the South and 135 in the North.

Hog slaughter was estimated at 418,000 head, 62,000 more than last week, but 1,000 less than last year. Barrows and gilts at the terminals trended steady on a live basis from 35.00 to 44.00 in a light test. The Missouri direct base carcass meat price closed steady from 52.00 to 55.00.  Iowa/Minnesota hogs closed .08 higher at 57.05 on a carcass basis, the West was down .36 at 57.15, and the East was .78 lower at 56.43.  Processing margins have narrowed somewhat and many in the trade are concerned about the defensiveness of the wholesale trade, but packers still started the week with decent appetites. Tuesday’s cash bids are expected to be near steady.

Lean hogs settled 17 higher to 100 points lower. Most of the selling pressure was seen in the deferred contracts as traders focused on the long term supply issues and the indication that overall demand may not reach out and meet that level. The February and May 2010 contracts showed the greatest losses, but had recovered from session lows. August settled at 59.17 up 12, and October was 32 points higher at 54.75. Pork trading was slow, with light demand light to moderate offerings. Pork carcass cutout was down .85 at 64.15.

Pork bellies ended higher despite the pressure from the lean pit as additional buying support surfaced as traders positioned themselves for a possible non-commercially led rally in the outside markets, according to DTN. August was 92 points higher at 62.22, and February was 52 higher at 84.00.