Market News

Feedlot cattle trade in Nebraska and Iowa at lower prices: July 9, 2009

Chicago Mercantile Exchange live cattle contracts settled higher on the rally in the lean hog pit along with optimism in outside commodity markets.  Rolling of positions into October out of August and short covering were features of the session. August finished 12 points higher at 83.47, and October was up 50 at 88.82. Boxed beef cutout values were weak to lower on moderate demand and moderate to heavy offerings. Choice boxed beef was down .93 at 137.52, select was down .34 at 132.29.

Feeder cattle ended 100 to 145 points higher on the broad based buying activity seen in most commodity markets. Short covering and buy stops also contributed to the higher close. August ended 130 points higher at 102.95, and September was up 145 at 103.30.

Feeder cattle receipts at the Bassett Livestock Auction, Bassett, NE totaled 4530 head on Wednesday. Compared to two weeks ago steers and heifers trended steady to firm. Source verified cattle showed a slight increase in price while natural cattle offerings showed the highest values. Demand was very good for the first day of the annual barbeque sale with a high number in attendance. Trade was active. Feeder steers medium and large 1, value added averaging 624 pounds traded at 118.64. 572 pound value added heifers brought an average of 111.20 per hundredweight.

Cattle slaughter was estimated at 126,000 head, the same as last week but 1,000 less than last year.  Cattle trading was moderate to active in Nebraska and Iowa with most of the dressed sales marked at 129.00, 2.00 lower than last week. Live business was evident in the North in a range of 81.50 to 82.00, generally .50 to 1.00 lower than last week. On the other hand the South remained quiet with bids and asking prices at least 2.00 to 3.00 apart.

Thursday’s hog slaughter was estimated at 398,000 head, 15,000 less than last week and 21,000 fewer than last year. Barrows and gilts at the terminals trended mostly steady with an instance of 1.00 to 2.00 in a range of 34.50 to 41.00. Missouri direct base carcass meat price was steady at 53.00 to 54.00. Iowa/Minnesota barrows and gilts closed .44 higher at 57.78, the West was unchanged at 57.69, and the East was down .35 at 55.13. Live hog weights continue to drop; Iowa barrows and gilts last week averaged 263.2 pounds, 1.9 pounds lighter than the previous week, but still 3.6 pounds above last year. Packer interest is still lagging with the weekly hog kill projected to be less than 2 million head. Friday’s cash market looks steady to weak.

Lean hogs settled 10 to 267 points higher, the August contract had been locked limit higher near midsession, but closed off the day’s highs. DTN’s Rick Kment said, the sharp upward moves were posted as commercial and non-commercial trade was active following the strength in outside markets.  July hogs were up 77 points to close at 59.70, and August was 267 higher at 63.70. Pork trading was slow to moderate, with light to moderate demand and offerings. The pork carcass value was up 2.38 at 57.93.

Pork bellies were in tune with the rest of the meats and settled 30 to 200 points higher. Cash prices remain stable even though weakness is seen in other pork markets with overall cash activity very light. July was up 95 at 59.85, and August finished 200 higher at 60.00.