Cattle futures down on technical weakness

Market News

Cattle futures down on technical weakness

Chicago Mercantile Exchange live and feeder cattle futures were lower on technical weakness and a sharply lower move in the Dow Jones Industrial Average. The losses were despite a higher midday move in beef, periodic losses in corn, and the steady to higher than a week ago direct business during the session. February live was down $.30 at $137.67 and April was $.27 lower at $141.85. January feeders were $1.25 lower at $161.45 and March was down $.95 at $165.42.

Direct cash cattle business was underway by early Tuesday afternoon. Light trade was reported at $137 on the live basis in Kansas and Texas, $1 to $1.50 higher than last week’s weighted averages, with light activity at $218 dressed in Iowa and Nebraska, unchanged from a week ago. Most of those dressed sales are reportedly for delivery either the week of January 31st or the week of February 7th. Asking prices were reported at $138+ live and $220+ dressed. This week’s show list looks mixed, higher in Kansas, Nebraska, and Colorado, lower in Texas. Last week, formula and trade volume totals were larger in all the major feeding areas.

Boxed beef closed higher with moderate movement. Choice was up $1.63 at $289.49 and Select was $1.43 at $278.39. The estimated cattle slaughter of 117,000 head was up 3,000 on the week, but down 2,000 on the year.

At the Callaway Livestock Center feeder cattle sale in Kingdom City, Missouri, compared to the previous week, receipts were much lighter due to heavy area snow. 400 to 500-pound steers were mostly steady, 500 to 600 pounders were unevenly steady to spots of $4 lower, 600 to 700-pound steers were steady to firm with spots of $2 higher, 700 to 750 pounders were steady to mostly $5 lower, and yearling steers over 750 pounds were not well tested. Feeder heifers weighing 450 to 550 pounds were steady to firm, with 550 to 600-pound heifers and 650 to 700-pound heifers mostly $5 to $6 lower. The USDA says 91% of the offering were feeder cattle, with 71% of that steers, and 54% of all feeders weighed more than 600 pounds. Medium and Large 1 feeder steers weighing 500 to 600 pounds ranged from $175 to $196 and 600 to 700-pound steers brought $167 to $181. Medium and Large 1 feeder heifers weighing 500 to 600 pounds were reported at $148 to $164 and 650 to 690-pound heifers sold at $151.50 to $152.50.

Lean hog futures were mostly higher on spread trade and the higher midday move in pork. That source of support Tuesday could turn into a pressure point Wednesday, with the cutout value closing sharply lower. February was up $.70 at $81.60 and April was $.82 higher at $89.27.

Cash hogs were mixed, with light to moderate closing negotiated numbers for the major direct markets. After the slow start to the week, buyers went back to assessing the availability of market ready numbers, near-term processing needs and chain speed, pork demand, and weather issues in parts of the region. That sharply higher close for national direct business could be a sign some buyers did not have their near-term needs covered.

National direct barrows and gilts closed $4.08 higher, with a base price range of $60 to $74.50 for a weighted average of $66.19. The major regional direct markets were not reported, due to confidentiality.

The Dorchester, Wisconsin butcher hog market was steady at $47. Garnavillo, Iowa was closed. Illinois direct sows were $1 to $2 lower at $30 to $41 on light demand for moderate offerings. Barrows and gilts were steady at $40 to $46 with moderate demand and offerings. Boars ranged from $10 to $25.

The pork carcass cutout value closed $4.73 lower at $87.21. All the primals were down, with sharp declines in loins, picnics, and hams against modest losses for butts, ribs, and bellies. The estimated hog slaughter of 468,000 head was up 15,000 on the week, but down 29,000 on the year. Monday’s hog slaughter was revised to 395,000 head, 7,000 less than the initial projection.