Activity in feedlot country was limited to the distribution of new showlists. While ready numbers were mixed (e.g., smaller in the South, larger in Colorado, and about steady in Nebraska), the overall offerings appear to be somewhat smaller than last week. According to the closing report, the national hog base is $0.75 higher ($68-$79, weighted average $77.55). Old- and new-crop corn futures were slammed 11-12 cents plus lower, pressured by yield-friendly crop ratings and tariff concerns. The stock market closed higher with the Dow better by 35 points and the Nasdaq up 57.
Generally speaking, live cattle futures closed moderately higher, up 7 to 60. The October contract was the only issue that settled in the red i.e., off 17. While Monday's round of fireworks was less than spectacular, traders did a pretty fair job in holding on to Friday's bullish lightshow. Beef cut-outs: mixed, up $0.20 (select: $198.77) to off $0.08 (choice: $211.88) with moderate demand and heavy offerings (76 loads of choice cuts, 35 loads of select cuts, 10 loads of trimmings, 12 loads of ground beef).
TUESDAY'S CASH CATTLE CALL:
Steady. Pre-holiday cash trading should be as quiet as a monastic library Tuesday, especially compared with the expected barrage of M-80s and cherry bombs. Significant trade volume will most probably be delayed until Thursday or Friday.
Feeders closed 60 to 232 higher with only spot August reined in somewhat by the discounted cash index. But most issues built quite a head of steam thanks to technical-buying and the big price break in the corn trade. On an estimated run of 2,000 head (down from 8,156 last week and none tied to the holiday last year), Oklahoma City sold feeder steers and heifers $5-$8 higher. Calves were lightly tested but had a sharply higher undertone. CME feeder index 06/29: $142.67, up $0.67.
Lean hog futures closed on a mixed basis up 170 to off 207. The selling pressure on August and October seemed to make sense in light of H&P totals and the record-large spring pig crop. Yet triple-digit gains in 2019 contracts seemed like more of a head-scratcher, especially given how the combo of breeding herd growth and larger farrowing intentions seem to threaten record production at least into the first quarter of 2019. Furthermore, triple-digit gains anticipated in the far horizon suggest the trade war worries will lessen as we move toward and into the new year. Let's hope that's the case. Carcass value closed under pressure with softer demand especially tied to loins, ribs and hams. Pork cut-out: $86.65, off $0.73. CME cash lean index for 06/28: $83.69, off $0.63 (DTN Projected lean index for 06/29: $82.97, off $0.72).
TUESDAY'S CASH HOG CALL:
Steady to $1 higher. Look for opening cash bids to be firm thanks to limited country offerings and stronger carcass value.
John A. Harrington can be reached at email@example.com
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