DTN Closing Livestock Comments

Cattle Futures Lose Early Bullish Steam to Close No Better Than Mixed

(DTN file photo)

Closing Comments

Light-to-moderate cattle trading developed in parts of Kansas and Texas with some live deals marked at $125, about steady with last week. Bids of $195-$196 were seen in the North. Many showlists continued to be priced of a firm basis around $128 in the South and $200-plus in the North. The Fed Cattle Exchange Auction report Wednesday listed a total of 4,813 head, with 2,855 actually sold, and 1,958 head listed as unsold. The state-by-state breakdown looked like this: KS 754 head at $125.00-$125.25; NE 1,462 head at $125.00-$125.25; TX 639 head, at $123.50-$125.50; CO no test; IA no test; other states no test. The weighted average was $124.99, up from last week's weighted average of $122.10. According to the closing report, the national hog base is $0.34 higher ($61.00-$69.50, weighted average $67.59). Corn futures closed 8-9 cents higher, further supported by rumors of greater potential for E15 sales. The stock market scored following Trump's speech before Congress. The Dow closed 303 points higher, settling above 21,000 for the first time ever. The Nasdaq finished 78 points to the good.

LIVE CATTLE:

For a minute there, it looked like new spot April was ready to take up the bullish torch with gusto. Indeed, early news from the FCE and preliminary country bids also seemed positive. Yet there was only so much bullish courage for April to find. Once stretching as high as $118.95 (still a good $6 below cash business), April slumped nearly 200 points before uncovering new takers. In the end, spot April closed 35 points lower while the rest of the complex advanced by 25 to 62. Beef cut-outs: sharply higher, up $1.52 (select, $202.57) to $1.85 (choice, $206.50) with moderate to fairly good demand and light to moderate offerings (71 loads of choice cuts, 30 loads of select cuts, 11 loads of trimmings, 22 loads of coarse grinds).

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THURSDAY'S CASH CATTLE CALL:

Steady to $2 higher. Cattle buyers are expected to start out in the morning with steady/firm bids. At this point, it is tough to know how many cattle moved today at $125.

FEEDER CATTLE:

Moderate gains early ran out of gas by late morning, opening the gate for feeder futures to settle moderately lower (i.e., off 20 to 102). Profit-taking and strength in the corn trade seemed partially responsible for the late reversal. CME cash feeder index: 02/28: $127.03, up $0.05.

LEAN HOGS:

Lean issues closed 17 to 82 higher with spot April gaining on summer contracts. While the lead month closed back over 68, it remained $6-plus under the cash index. Carcass value closed moderately lower, limited by softer sales of loins, hams, and bellies. Pork cut-out: $81.62, off $0.32. CME cash lean index for 02/27: $75.89, off $0.83 (DTN Projected lean index for 02/28: $74.77, off $1.12).

THURSDAY'S CASH HOG CALL:

Steady. The cash hog trade should open near steady. Movement seems to be on the slow side, but may be enough given uncertain pork demand.

John A. Harrington can be reached at john.harrington@dtn.com

(ES)

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