Market News

Live and feeder cattle contracts close mostly firm, but hogs were lower: June 18, 2009

Chicago Mercantile Exchange live cattle contracts settled higher. Buying support remained solid following expectations of steady to higher cash markets. The majority of the buying was seen in the nearby contract months, but the upward momentum had an effect on the early 2010 contracts. There was some forward spreading. June ended .57 higher at 80.77 and August was up .32 at 81.79. Boxed beef cutout values ended weak to lower on light to moderate demand and moderate offerings. Choice boxed beef was down .50 at 139.93, and select was .87 lower at 133.08.

Feeder cattle closed mostly higher on support from the live pit, buy stops and bull spreading. Lower corn values leant additional support. August was up .47 at 97.80, September was down .02 at 97.67.

Feeder cattle receipts at Ogallala, Nebraska on Wednesday totaled 1300 head. Compared with two weeks ago based on a limited and narrow test the bulk of the offerings trended mostly steady with instances of 2.00 to 4.00 lower. Feeder steers medium and large 1 weighing 830 lbs traded at 96.98, 791 lb heifers brought an average of 92.33 per hundredweight.Thursday’s cattle slaughter was estimated at 127,000 head, 3,000 more than last week, and 1,000 less than last year. DTN reports regional packers bought a few cattle on Thursday afternoon at 131.00 on a dressed basis in Nebraska and Iowa. Beyond that the country was very slow with feedlot managers holding firm at 84.00 in the South and 132.00 to 134.00 in the North.

Barrows and gilts at the terminals trended steady to 1.00 higher from 33.00 to 38.00 on a live basis. The Missouri direct base carcass meat price was steady from 48.00 to 52.00. Thursday’s hog kill was estimated at 408,000 head the same as last week, but 3,000 more than last year. Iowa/Minnesota hogs closed .36 lower at 57.02, the West was down .07 at 57.35, and the East closed .46 higher at 53.96. Packer margins are poor and the pork carcass cutout took a big hit on Wednesday. Friday’s market looks steady to weak.

Lean hogs settled unchanged to 82 points lower as overall cash markets were unable to sustain the upward price push seen earlier in the week. However the market held much better than earlier expected. July was down .02 at 59.92, and August was down .40 at 59.15. Pork trading was slow to moderate, with light to moderate demand and offerings. The lean carcass cutout was up .71 at 55.58.

Pork bellies closed 30 to 100 points higher as traders once again became aggressive following the follow through buying support over the last couple of days, according to DTN. July ended .70 higher at 59.50, and August was up 1.00 at 59.05.