DTN Closing Livestock Comments

GENERAL COMMENTS

Cash cattle activity on Monday was typically limited to the distribution of new showlists. Ready numbers appear to be generally larger with only Texas offering fewer steers and heifers. According to the closing report, the Iowa hog base closed .79 lower compared with the prior day settlement ($52.00-59.50, weighted average $56.50). Closing at a 3-week low, nearby corn futures fell more than 7 cents lower, pressured by both winter wheat and beans. The stock market put in a rough day with the Dow off 335 on the close and the Nasdaq down by 137.

LIVE CATTLE

Live contracts closed sharply lower, off 105 to 162. Last week's failed rally has reminded bears of their stubborn mission to lead cash lower through the second quarter. Spot April closed at its lowest level since January 12. June settled at its sorriest level since early last September. Beef cut-outs: mixed, up .43 (select, $217.29, up .43) to off .72 (choice, $224.89) with light to moderate demand and offerings (37 loads of choice cuts, 17 loads of select, 11 loads of trimmings, 13 loads of ground beef).

TUESDAY'S CASH CATTLE CALL:

Steady to $2 higher. Further board weakness Tuesday could trigger some early week country selling, especially if hedgers perceive attractive basis opportunities.

FEEDER CATTLE:

Following the sell-off in the live market, feeder futures settled mostly 122 to 200 in the red. Needless to say, commercial buying interest continues to dry up in the face of imploding deferred live values. On an estimated run of 6,800 head (down from 9,169 last week and near even with last year), Oklahoma City sold feeder steers $3 to $6 lower. Their heifer mates were lightly tested with some marked $2 to $4 lower. Stockers and calves traded as much as $4 to $10 lower. 03/16 cash index: 141.73, off .98.

LEAN HOGS:

Lean issues closed mostly 110 to 230 lower. Always hog and pork fundamentals have been nothing to shout about this month, most players are assuming that a seasonal rally will kick in in the near future. This may suggest that at least part of the selling energy seen here Monday was tied to spillover negatives from the cattle futures. Carcass value closed moderately lower with lower loins, hams, and bellies overshadowing stronger butts, ribs, and picnics. Pork cut-out: $71.98 (FOB Plant), off .59. CME cash lean 03/15: 65.52, off .41 (DTN Projected lean index for 03/16: 64.97, off .55).

TUESDAY'S CASH HOG CALL:

Steady to $1 lower. Hog buyers are likely to remain on the defensive in the morning with opening bids steady to $1 lower.

John Harrington can be reached at harringtonsfotm@gmail.com

Follow him on Twitter @feelofthemarket

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